Services
Debt Consolidation
Debt consolidation with a Remortgage means adding your debt to your mortgage balance, using some of your equity to pay off your debts. The benefit is potentially lowering your monthly debt repayments to be more manageable. It’s actually life changing for some clients.
Your remortgage will increase your mortgage balance and swallow up your debt within your mortgage. That means you’re paying the debt back over a longer period of time, paying less each month and possibly on a lower interest rate.
But on the flip side you’re spreading that debt over a long period of time and you will end up paying more overall. Our job is to look at that over the short term and long term and explain it to you.
First Time Buyers
Buying your first home can be both an exciting and nerve-racking experience. The exciting bit is having your own front door and space to call your own; the nerve-racking part can be finding somewhere you can afford, saving enough for the deposit and getting a mortgage product that’s right for your financial circumstances.
ML Mortgages know what’s happening in the market, so we can help you make your mortgage application to the most appropriate lender when the time is right.
As a mortgage is secured against your home, it could be repossessed if you do not keep up the mortgage repayments.
Buy to Let Mortgages
Rising property values and a booming lettings market has meant that many lenders have developed mortgage deals tailored to the needs of would-be landlords.
A Buy-to-Let mortgage is a loan for purchasing a residential property that is let to tenants rather than lived in by the borrower. The typical deposit required is likely to be around 25%, although better deals will be available to those who can put down as much as 40% of the purchase price. Most buy-to-let mortgages are available on an interest only basis. Lenders will consider the potential rental income the property will generate when deciding whether to grant the loan.
A Buy-to-Let mortgage will be secured against your property.
The Financial Conduct Authority does not regulate some forms of Buy-to-Let mortgages.
There is no guarantee that it will be possible to arrange continuous letting of the property, nor that rental income will be sufficient to meet the cost of the mortgage.
Your property may be repossessed if you do not keep up repayments on your mortgage.
There may be a fee for mortgage advice. The actual amount you pay will depend upon your circumstances. The fee is up to 1% but a typical fee is 0.3% of the amount borrowed.
Specialist Mortgages
Some borrowers have more complex borrowing needs. These are some of the more specialist mortgages that are available.
Bad Credit Mortgages
All lenders will conduct a credit check on anyone applying for a mortgage. Many high-street banks may refuse to offer a mortgage if you have a bad credit history, but there are specialist bad-credit mortgage lenders who will be more flexible when assessing your mortgage application. However, the mortgage offered may mean you need to put down a larger deposit and be prepared to pay higher- than-average interest rates.
Alternatively, you may want to consider trying to improve your credit score before applying for a mortgage, in order to increase your chances of being accepted for a standard mortgage.
It pays to be cautious about applying for a mortgage if you think you might be rejected. This is because every time you apply for credit it is likely to be recorded on your credit history and unsuccessful applications can bring down your credit score.
At ML Mortgages we can make recommendations based on your own individual situation.
As a mortgage is secured against your home, it could be repossessed if you do not keep up the mortgage repayments.
Ltd Company Buy-to-let
With a reduced range of products, you need to choose the mortgage that is best for you. This isn’t just a question of opting for the lowest interest rate and cheapest monthly repayments. Like residential mortgages, buy-to-let mortgages need to be compared in terms of any extra fees that may be applicable, as well as additional benefits they offer.
Consulting an experienced, impartial mortgage adviser is advisable as they can provide expert advice on which product is best for your needs.
A Buy-to-Let mortgage will be secured against the property. The Financial Conduct Authority does not regulate commercial Buy-to-Let mortgages.
Portfolio Buy-to-Let
New affordability rules were introduced in 2017, which mean that portfolio landlords need to meet specific affordability rules for all properties they own, rather than the overall affordability of their portfolio, when applying for new finance.
However, some lenders use a method called ‘top-slicing’ when assessing your application. This allows the lender to take into account any additional income you have, apart from rental income, when they calculate what they are willing to lend you. Top-slicing is unlikely to be appropriate if you have little in the way of disposable income or savings and therefore do not have income to cover unforeseen events.
If you are already a portfolio landlord or you are aiming to grow your property portfolio, you could consider a portfolio mortgage which allows you to have the whole portfolio under one mortgage.
A Buy-to-Let mortgage will be secured against your property. The Financial Conduct Authority does not regulate some forms of Buy-to-Let mortgages.
Green Mortgages
As climate change continues to pose an ever increasing threat, both brokers and lenders alike are committed to doing their part to help the future of the planet. To support this a number of lenders are now offering ‘green mortgages’, which provide preferential interest rates if your home meets certain standards in terms of energy efficiency.
Please contact us to find out more about green mortgages and whether your current or potential new home qualifies.
There may be a fee for mortgage advice. The actual amount you pay will depend upon your circumstances. The fee is up to 1% but a typical fee is 0.3% of the amount borrowed.
Re-mortgage
There are numerous reasons why someone would want to do a re-mortgage. Searching lenders and available deals could save a considerable amount of money. Here are few reasons why you would want to use a broker:
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Find a lower interest rate could save you money each month whether with current lender or changing to a more competitive option elsewhere
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Raise capital or release some funds for one-off purchases such as a home improvement project
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Reduce your monthly outgoings by Consolidating your debts such as credit cards and personal loans. With this option you should always be aware that this may also extend the repayment term and possibly increase overall costs
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You could consider re-mortgaging to invest in buy to let properties
You may have to pay an early repayment charge to your existing lender if you remortgage.
Protections
Level Term Assurance
Level Term Assurance pays a lump sum in the event of death during the term of the policy. There is no investment element within a term assurance contract, so at the end of the term there is no maturity value and life cover ends. The benefit is paid tax-free. Premiums are usually monthly and fixed throughout the term. As the term and benefit are known from the outset, and there is no investment content. Term assurance can be a cost-effective method of protection.
Decreasing Term Assurance
Decreasing Term Assurance works in a similar way to Level Term Assurance, but the benefit is set at the outset and gradually decreases over the term of the policy. These policies can be used as cover for a repayment mortgage, or other loans where the amount of capital outstanding also decreases over time. As the benefit reduces over time, the premiums are usually lower than for Level Term Assurance.
Family Income Benefit
Family Income Benefit works the same as term assurance but instead of paying a lump sum upon death, it will usually pay a regular monthly/annual tax-free income in the event of death to your dependants up until the end of the term of the policy.
Critical Illness Insurance
Critical Illness Insurance is usually available as an addition to all term assurance plans but can be bought on a standalone basis. Critical illness provides a lump sum benefit / income in the event of diagnosis of certain critical illnesses, such as heart attack, stroke, transplant, blindness, total and permanent disability. The illnesses covered will be specified in the policy along with any exclusions and limitations – these differ between.
For insurance business we offer products from a choice of insurers.
Buildings & Contents Insurance
Arguably your home is one of your most valuable possessions and it contains all your belongings and memories. Whether you rent or own your home, insuring it makes sense. There are two main types of home insurance to consider – buildings and contents. As the names suggest, buildings insurance protects the property itself, whilst contents insurance covers the furniture, furnishings, appliances, clothing and all your possessions.
Whatever the type of property you live in we’ll be able help find the cover you need. We’ll also be able to help you get the right cover for all your home contents and it is important not to underestimate just how much the contents of your home are worth and how much would it cost to replace all the contents of your home?
The great news is that we have a panel of Insurers to help choose the right policy for you and your individual circumstance.
Income Protection
This policy is designed to provide an income in the event the insured individual is unable to work due to ill health. The level of premium will depend upon the amount of benefit and term selected. Most policies cease to pay the benefit once the insured is able to return to work. Income protection policies are usually written to retirement age or 60 if earlier.
Accident, Sickness & Unemployment (ASU)
ASU policies were traditionally sold to accompany mortgages, allowing for a regular income to be paid to the insured should they be unable to work due to ill health, an accident or lose their job. The product can be split down, and unemployment cover is usually the optional extra available for an additional premium. Benefits are only usually paid for a specified period, for example 12 months. It is important to compare ASU and Income Protection closely as one may be more suitable than another. It may also be beneficial to use the two products to work in tandem with each other.
Useful Information
Having a survey carried out on a property before you commit to buying it makes financial sense, as it can save you thousands of pounds in repair bills. There are various options available, and we can offer help and advice on choosing the type that meets your needs.
Surveys – what you need to know
A mortgage valuation isn’t the same as a structural survey. A mortgage valuation is undertaken by your lender to assess whether the property you want to buy is sufficient security for your loan. It won’t tell you about the state of the property or show up any underlying faults in the way that a survey does.
There are two main accrediting bodies for surveyors – the Royal Institution of Chartered Surveyors (RICS) and the Residential Property Surveyors Association (RPSA) – and you should check that your surveyor is a member of one of them.
RICS surveyors offer three levels of survey:
RICS Condition report:
This is the most basic form of survey and is aimed at new build and conventional homes in good condition.
RICS Homebuyer Report:
The next level up, this will identify structural problems and common problems such as subsidence or damp
RICS Building Survey:
The most comprehensive survey, this covers a full inspection and give professional advice on any repairs that may be required and the likely costs involved.
If the surveyor reports problems that need to be remedied, you could still decide to go ahead, using the survey findings to renegotiate the purchase price.
In Scotland, sellers must have a Home Report available for would-be purchasers, carried out by an qualified surveyor. New build, converted homes, or properties purchased under Right to Buy don’t have to have a Home Report. However, purchasers should still consider having a survey carried out.
Why your credit score matters
Mortgage lenders look carefully at how you manage your finances when assessing your mortgage application. If you want to qualify for a competitive mortgage rate, then you need to have a good credit rating. When a potential lender reviews your application, they’ll look at your credit report at one or more of the main credit reference agencies like Experian or Equifax.
Generally, the higher your credit score, the better your chances of getting a good mortgage product at a lower interest rate.
Simple steps like paying your utility bills and making existing loan repayments on time, increasing your monthly credit card repayments, registering on the Electoral Roll and not taking on additional borrowing before you make your mortgage application, can help improve your chances of having a good credit score.
It pays to check your credit score. If it’s not as good as it could be, take steps to improve it before you make your mortgage application.
What are the main stages in buying a property?
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Here are the major milestones in the house buying process:
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Contact your adviser to discuss your plans
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With your adviser, work out how much you can
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Draw up a budget to cover legal costs, surveys and mortgage fees
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Make your application and get a mortgage agreed in principle
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Start looking for a property you can afford
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Make an offer
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Arrange the most suitable protection plans with your adviser
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Expect your lender to arrange a mortgage valuation on the property
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Appoint a solicitor or conveyancer who will start the searches and legal work
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Arrange a survey, in Scotland review the Home Report and arrange a survey if necessary
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Finalise your offer and agree your formal mortgage offer
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Arrange to get your deposit to your solicitor
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Exchange contracts (England and Wales) or agree the contract (Scotland)
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Arrange buildings insurance to start from date of exchange of contracts
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Arrange completion and pay Stamp Duty if applicable
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Move in
As a mortgage is secured against your home, it could be repossessed if you do not keep up the mortgage repayments.
Mortgage Types
Repayment
This is the most popular and widely-available option, where you make monthly repayments for an agreed period of time until you’ve paid back both the mortgage capital and the interest.
With a repayment mortgage, or capital repayment mortgage, to give it its full name, you pay back part of the mortgage capital and interest each month. At the outset, most of your monthly payments will comprise of interest; over time, more of your monthly payment will be repaying the capital.
With a repayment mortgage, you are guaranteed to repay the full mortgage by the end of your mortgage term, provided you make your repayments in full each month.
As a mortgage is secured against your home, it could be repossessed if you do not keep up the mortgage repayments.
Tracker Mortgages
The actual mortgage rate you pay will be a set interest rate above or below the rate tracked. When the rate tracked goes up, your mortgage rate will go up by the same amount. And it will come down when the rate tracked comes down.
As a mortgage is secured against your home, it could be repossessed if you do not keep up the mortgage repayments.
Variable Rate
With this type of product there isn’t usually an early repayment charge with your lender, so you can move to another type of mortgage at any time and can potentially overpay your mortgage to pay it off faster and shorten the term. However, variable rate mortgages can potentially change if the Bank of England base rate rises or falls, making it harder to budget for your repayments. There can often be better and more cost-effective deals available in the marketplace.
As a mortgage is secured against your home, it could be repossessed if you do not keep up the mortgage repayments.
Discount Rate
A discount rate is a type of variable rate mortgage where the interest rate is set at a discount below a rate of interest, typically the lender’s Standard Variable Rate (SVR) for an initial period of time, typically two or three years.
The obvious benefit here is that the rate is lower, so your repayments will be cheaper. However, if interest rates rise, you can expect your repayments to increase too. You also need to be aware that lenders have differing SVRs, so you may need help in working out which discount deal is most suitable and most cost-effective option for you.
Capped Rate
The interest rate is often higher than that available on other variable and fixed rate mortgages and the cap can be set quite high. However, it provides the certainty that your payments will not rise above a certain level.
A capped rate is normally only available for an introductory period, which can typically be from two to five years.
This type of mortgage may also have a minimum rate of interest that the lender will charge for a specified period. This is referred to as a ‘collar’.
Cashback Mortgage
The amount you receive is normally expressed as a percentage of the amount you have borrowed, although it can be a fixed amount. It’s important to be aware that this type of mortgage may not be offered at a competitive rate and might mean that you’ll be paying higher monthly payments as a result.
As a mortgage is secured against your home, it could be repossessed if you do not keep up the mortgage repayments.