Buying a home can be a stressful experience, which is why home movers and first time buyers in Coventry use a mortgage broker to help make sure their home buying process go as smoothly as possible. It’s comforting for our customers to know they have someone on their side, on hand to answer any enquiries they have.
A mortgage advisor in Coventry will ensure you obtain the cheapest mortgage to suit your needs. We take full responsibility for recommending the most suitable mortgage for you and package your application to the Lender in such a way to give it the best chance of success.
The same applies when you come to remortgage too, we like to know our customers are on the cheapest deal for the entire mortgage term.
If you’re looking at taking out mortgage advice when buying a home, we recommend talking to a mortgage advisor in Coventry. Your committed member of the Moneyman team will be able to help you work out how much your payments will be, as well as how much you may be able to borrow.
That said, different lenders have their own strict lending criteria, so it does help to speak to an expert. If you know what you can afford well in advance of making an application, it may help you avoid any potential future disappointment.
We aim to ensure all customers are informed about their mortgage application progress so you are fully aware of what is going on. If you have any questions, we are available seven days a week, ready to help you out in any way we can.
Mortgage Brokers work for the customer, not the Lender. This is something that is important to remember throughout your process. Our team are firmly in your corner, sometimes having to argue how strong an application may be, in order to ensure it goes through.
Our company process of requesting and checking your proof of income and bank statements ahead of time allows us to try and avoid any hurdles that may arise, hopefully before they can become a factor.
We also can help you choose the right type of survey for your property, as well as instruct a Solicitor on your behalf to carry out the legal aspects of your transaction.
We love to build up customer relationships and assist with future mortgage enquiries, whether as a Buy-to-Let landlord with your portfolio or remortgage when your term ends. This often starts with an affordability assessment and Agreement in Principle prior to even finding a house.
Once your purchase is complete, a member of our team will keep in regular contact, and we will get in touch once more to discuss your remortgage options. We can then compare the market on your behalf as we did before to help you obtain the best remortgage deal available for your circumstances.
If you are a first time buyer in Coventry, you may not aware of what a mortgage agreement in principle is. A mortgage agreement in principle (sometimes shortened to AIP or DIP – decision in principle) is a document that demonstrates the lender believes, so far, you are a good candidate for a mortgage and are ready to go.
This shows both the estate agent and the person selling their home, that you are creditworthy as you have passed the lenders initial credit score. It’s important to remember though that this is not a guaranteed mortgage, as going for a full application will require even more in-depth background checks.
However, it is a good idea to get one done at the earliest opportunity for the following reasons:
When you are at the point where you would like to make an offer on a new home, you’ll find that the majority of estate agents will undertake due diligence and ask you to provide them with proof that you do in fact have the means to proceed with the property purchase.
Your proof will usually come in the form of bank statements, but can also be done using an agreement in principle. This is something that we can provide for you, usually within 24 hours of your initial appointment.
Once you have provided them with all this documentation, the estate agent will generally cease marketing the property and put a “sold” or “sale agreed” board up outside of it.
If you already have a mortgage agreed prior to making an offer on a property, this will definitely appeal to the seller, as this proves you are not making an offer on the fly and have actually put a lot of thought into how you’re going to fund the purchase.
This might persuade a seller to accept an offers you make that could possibly be under their asking price.
When it comes to purchasing a new or additional home, some customers like to try and run before they can even walk. They charge ahead all guns blazing, making an offer on a property without actually making sure they can proceed in the first place.
If the application then goes ahead and fails, this can result in disappointment that could’ve been avoided. The last thing you want to be doing is having your heart set on a new family home and then feeling down when it doesn’t work out the way you had hoped.
This can all be prevented by getting in touch with us at an earlier stage. Sometimes there are factors that may cause an application to fail, that given time and care with the help of a mortgage broker in Coventry, can be solved over time.
An example of this is, let’s say you have a disputed mobile phone bill that keeps cropping up. This is something that can be sorted with the appropriate action. Some think they’re on the voters roll when they are not. Give it a few weeks and that can be sorted too.
In some cases you might not be able to get a mortgage at all. If that does happen to be the case, it’s better that you are made aware of that now rather than mess people about. One of our dedicated mortgage advisors will be able to tell you what you need to do to improve your credit-worthiness for the future.
Let’s say in theory, you know that you have got a good credit rating and have never been turned down for credit, you’re registered on the voters’ roll and you’ve always keep up your monthly credit payments. What could possibly go wrong?
Well the truth is, you could approach 10 different lenders these days and get 10 different results from each of them! They all have their own lending criteria and calculate affordability in their own unique ways.
If you are Self Employed in Coventry it can be complicated further, as some lenders may take your net profit, whilst others are known to use your salary and divided. In some cases, you’ll find that lenders may even use your latest year, whilst others prefer an average over 3 years.
Being mindful of your borrowing limits is important as this will help you determine what your ideal price range will be. Ou dedicated mortgage advice team will be able to advise you of the maximum mortgage available to you. Also, more importantly, together we’ll work out how much you can afford to pay back on a monthly basis.
Typically, you’ll find that the highest interest rates come with long-term fixed-rate mortgages. This is why it sometimes may be best to fix your mortgage in short term.
Even though a short term fix could potentially save you money further down the line, you’ll have to frequently review and renew your mortgage because of it. When you’re remortgaging in Coventry, depending on how the economy is and what deals are available on the market, you may be able to access a good rate during every point of remortgaging.
At the point of remortgage, you may end up finding a better deal than your previous, or you could end up being on one that’s a little more expensive, you’ll never know until you start looking!
If you’re looking to fix your rate for longer than 2 years, you may be better at looking for products with a fixed term between 3 and 5 years.
As a mortgage broker in Coventry, we’ve found that the most popular fixed-rate products are in 5-year terms. These deals are neither too short nor too long. A 5-year term will also add the security of constant monthly payments for the foreseeable future.
There’s really only one negative to fixing into a 5-year term. Overall, your payments may work out more expensive than if you had taken out a 2-year product and then a 3-year product, but not by much.
If you wanted to take out a fixed-rate mortgage for even longer, for example, a 7 to 10-year fixed-rate product, you may need to try and approach specialist lenders as there are a limited number of these deals on the market. By choice, these deals aren’t the most popular of choices amongst home buyers and owners. This is down to the length of the term. Also, you won’t get much flexibility whilst being fixed into a mortgage with a long term; they may also come with expensive setup fees and rates.
You also need also consider the additional fees that come with remortgaging. Be aware of costs such as booking and arrangement fees. Usually, a booking fee will be charged upfront, whereas an arrangement fee will be charged upon completion. You may get the option to incorporate these fees into your mortgage payments, this will not only increase your payments each month but also increase the total amount paid for the fees as their costs will increase due to the interest.
Did you know that if you have the funds in place to so do, you can pay off some of your mortgage early? If you want to remortgage now rather than waiting till the end of your term, you can pay off your fixed-term total and remortgage early.
However, if you choose to do this, it’s likely that you’ll be charged with an ERC (early repayment charge). This is because you are tied into a deal for a set period of time, so paying it off early and remortgaging will cost you. You should continue if you are okay with paying the ERC.
Your ERC total is taken from a percentage of the amount that you still owe on your mortgage, not your term. For example, if you have £200,000 left on your mortgage, you may get something like a 2% ERC which is £4,000. If a current deal is available on the market that is better than your current one, it may be more beneficial for you to take the ERC and remortgage early as the product may go.
As a mortgage broker in Coventry, we always advise not to chase ‘headline’ deals. You should know that more often than not, the deals with the lowest rates come with the highest arrangement and setup fees.
For further fixed-rate and remortgage advice in Coventry, please get in touch today. We have helped 1000s of customers secure competitive fixed-rate products in the past, and we want you to be next!
Contact us for a free mortgage review in Coventry.
If you have been looking at getting a mortgage or more specifically have been looking at your options for a Remortgage in Coventry, it’s likely you will have seen the term Capital Raising before.
You may see such a term and be wondering what that means, what exactly is Capital Raising? The answer is simple; Capital Raising is the act of raising money, in this case referred to as Capital. This is done through a few different methods and can be used for various reasons.
A common way for this to occur is for customers to take out a Remortgage as a means of releasing the equity in their property. Equity is the difference between what you have left to pay on your mortgage and the true value of the property.
If your property happens to increase in value over the duration of your mortgage, rather than Remortgaging to Release Equity, you may find yourself looking to do this with a Further Advance. This is where you take out an additional mortgage on your property to borrow even more, as a means of once again releasing equity.
This mortgage will typically be over a longer term and have interest rates that are lower than a standard personal loan, although it will be paid back alongside your existing mortgage.
This can be a great option for those who do not wish to Remortgage, or maybe tied into their existing deal. However, there are risks, such as a higher risk of repossession if you cannot keep up the significantly larger number of monthly repayments.
A Second Charge Mortgage works similar to that of a Further Advance, wherein you will be taking out an additional mortgage alongside your existing one, as a means of releasing the equity in your home for future home improvements or anything else you wish to spend your newly acquired funds on.
The difference between a Second Charge and a Further Advance is that a Second Charge will often be with another lender and on a different rate. In the unfortunate event of a repossession, your initial mortgage lender will be paid back from the property’s sale, with any remaining funds used to pay off the Second Charge.
You may find yourself needing to Capital Raise and release equity via a Remortgage, for all kinds of reasons. Popular choices for this include to fund any Home Improvements, Modifications or Alterations, such as a new home office, a possible home extension or even a loft/garage conversion, as well as to consolidate any debts that have been accrued over time.
Other options may include to gift a deposit to your children, to purchase a second home (usually an option with Buy to Let Landlords in Coventry), to fund large purchases such as a car, wedding or holiday.
If you have equity in your property and are looking to take out a capital raising mortgage, then a Remortgage in Coventry could be useful to you. Generally speaking, mortgage lenders will let you borrow up to 90% of the value of your property.
Please do Get in Touch and we will advise you of the most appropriate option for your circumstances. If remortgaging isn’t quite for you, taking out unsecured credit might be a more suitable option for you. A standard Remortgage can take roughly around 4 to 6 weeks to go through.
With Debt Consolidation there are some risks to take into account. That is why we always recommend you speak with a qualified Mortgage Advisor in Coventry, before consolidating any unsecured debts against your home.
Coventrymoneyman is an experienced Mortgage Broker in Coventry, here to help you find the best capital raising mortgage deal for both your financial and personal situation. All of our customers will benefit from a free Remortgage consultation. During this consultation we will make a full recommendation.
If you are over the age of 55, you may find yourself better suited for taking up Equity Release in Coventry.
The mortgage journey is one that can be quite rewarding in the long run. Though you will face your fair share of both positives and negatives throughout your process, in the end you will end up with one of the following: either the property of your dreams to call home and maybe start a family, a stepping stone property to help you find your place on the property ladder or an investment property to provide you with an income boost.
No matter which mortgage path you went down, eventually you will find yourself reaching the end of your mortgage term and in need of a different path to venture down. You may find yourself with the option to sell up and upsize/downsize into a new property.
You may possibly even be in the market for selling your portfolio to the tenant(s) or another buyer and look at other fortuitous financial experiences. The most popular option we hear though, over everything else, is a Remortgage.
First of all, let’s look at the definition of what a Remortgage is. A Remortgage is the process of using the funding from a new mortgage to pay off a mortgage that already exists. There are various options you may have when taking out a Remortgage, ranging from small ones to slightly bigger ones.
By utilising the 20 years or so knowledge of Coventrymoneyman’s resident “Moneyman” Malcolm Davidson (host of our YouTube channel MoneymanTV), we thought it would be of great use to everyone, if we put together a handy guide to all the options at your disposal when it comes to starting the Remortgage process.
The mortgage deal you initially start with will normally last somewhere within the realm of 2-5 years, featuring lower fixed rates or possibly discounted rates. In some cases, your lender may even put you on something like a tracker mortgage, a mortgage type which follows the Bank of England’s base rate.
When reach the end part of your mortgage term, you will likely be placed on the lenders Standard Variable Rate (you may see this simply called SVR). The purpose of an SVR, is that this mortgages interest rate can possibly increase or decrease, depending on what the lender determines correct to charge you.
This type of mortgage does not follow the Bank of England’s base rate like a tracker mortgage would do, and as such can be a little more of a risk, as the lender is not legally obligated to charge the amount that might typically be recommended.
Because of this, Standard Variable Rates, generally speaking, are more expensive paths to take, leaving many to look at their options of Remortgaging for better rates. This would hopefully save the homeowner a little bit of money on their monthly repayments.
Once you’ve gotten through the majority of your initial term, you may feel like something isn’t quite right, like something needs to change. It could be that you need some space for an extra room or larger living space for your kids or belongings.
We also see people doing this for a new kitchen, a new office, or even a loft conversion (which seem to be quite popular these days). Instead of just moving into a newer, much larger house, many seek to release the equity in their home with a Remortgage, in order to cover the costs of any potential improvements, alterations or modifications.
Though the idea of obtaining planning permission from a local authority, and both funding and managing your own project seems a scary task, some would argue it’s a lot less stressful and more rewarding than the process that simply house hunting, selling your home and moving out.
As time passes by, this may prove even more to be a smart investment choice, as creating more space and having good quality craftsmanship will likely increase how much your home is worth. This is very useful for if you ever do decide to sell up or rent your home out to someone else.
In some cases, some homeowners may wish to Remortgage in Coventry in order to find themselves a better mortgage term, whether that be by reducing the length of the term in question or by switching to a product that is more flexible.
Doing this will mean you will be paying back your mortgage over a shorter amount of time, so you won’t be tied down for a large portion of your life. However, this route will also mean that your monthly repayments will be higher than they otherwise would’ve been. The general rule of thumb is that the longer your term, the lower the payments will be over time.
A lot of homeowners choose for their mortgage term to be a little more flexible when they take out a remortgage. It’s the benefits provided by this option that tend to sway homeowners more in its favour. Through this, you may gain the ability to overpay your mortgage.
This means you have the ability to pay your mortgage off quicker, as well as being able to carry the same mortgage and rates over to another property of your choosing, just in case you ever decide to find a new property at any point in the future.
Though a flexible mortgage sounds like it would be ideal for you, they will usually come in the form of a tracker mortgage. As discussed earlier on, these mortgage types follow the Bank of England base rate. This means your payments could fluctuate based on interest, potentially making them a little unreliable when your monthly payments come around.
Every homeowner has some amount of equity in their home. How much exactly, depends on factors. It can be worked out by calculating the difference between what is still owed on the mortgage and the current amount your property is valued at.
As mentioned slightly earlier in this article, equity can be used for home improvements, though that’s not all you’re limited to when it comes to using your equity. Some use their released equity to cover long-term care costs, to supplement their income, to have a holiday, to pay off an interest-only mortgage or to simply have extra money to spend freely and treat themselves.
In the occasional case, we find that Buy-to-Let landlords will use Equity Release as a means of covering their deposit for additional property portfolio purchases.
Another big one that works in conjunction with Equity Release, is releasing funds to pay off any unsecured debts that may have built up over time.
Though it may seem like a fairly straightforward task, Debt Consolidation not only bases the amount on how much you’re owed and the value of the property, but it also factors in where your credit rating is currently at.
This could mean that whilst you may be able to use some money to cover these costs, you’re limited from the offset in terms of how much they’ll even let you borrow.
In addition to this, to pay off your previous mortgage and your debts, you will need to borrow more than the mortgage amount that is remaining on your balance. This will almost certainly mean that your monthly repayments will be higher than they were previously. Though not an ideal situation to find yourself in, you can at least rest assured that should you find yourself in need of a back-up plan, you do have some mortgage options to choose from.
If you happen to have a damaged credit rating, you may also still have a chance to obtain a mortgage, though this process will not be easy and requires very Specialist Remortgage Advice in Coventry before you can even proceed. Even with a professional by your side, there is still no guarantee that this will even be something you can do.
We recommend that you always seek mortgage advice before choosing to consolidate and secure any debts against your home.
If you are reaching the end of your term and are looking at your home owning and remortgage options may be, please do Get in Touch with an experienced and trusted mortgage broker in Coventry today and we’ll see how we could help.
An dedicated mortgage advisor in Coventry will be able to discuss your circumstances and future plans, in order to create the best path to take on the next leg of your mortgage journey. It is our aim as a mortgage broker to ensure this time around is a quicker and easier process than when you took out your mortgage the first time.
No matter if you are a First Time Buyer in Coventry, looking to take that initial step onto the property ladder, thinking of moving home in Coventry, or looking to Remortgage for any potential Home Improvements, the concept of overpaying, even by a minor amount, can make a huge difference in the amount on the interest you pay back over the course of your mortgage term. The earlier you look at overpaying, the better the effects of your extra mortgage payments.
Whether or not this is done, depends on the homeowner. Some may choose not to down this route, whilst some struggle to afford these additional payments. A lot of the time though, it comes down to life getting in the way.Even still, if you can, overpaying is the ideal thing to do when you take out a mortgage. Let’s be honest though, there’s always something new and flashy we’d rather buy, as opposed to making an extra payment on the mortgage.
Part of the problem here is remembering to overpay. It’s not something that’s particularly likely to cross your mind too often. Possibly when your mortgage only has a few years left, but the impact at that point isn’t as great as it could have been if you’d done it earlier.
An easy way to make overpaying part of your routine is to set up a standing order paying your lender each month. Even better, organise it so that it goes out the same day as your mortgage payments. This way, it just feels like one amount and you will become used to this.
By using a standing order, you’re in control. Unlike a direct debit which the receiver controls, you can easily cancel a standing order if your financial situation changes. Whilst it would be a shame to stop overpaying, at least you would benefit from the overpayments made up until that point.
Overpaying your mortgage is a great habit to get into. You don’t need to pay huge amounts unless you feel you can. But you’ll be grateful toward the end when you realise you’ve been able to shave a year or two off your repayments.
If you overpay, some mortgage providers will even let you make reduced payments or take a payment holiday if you have been overpaying for a while. Before taking a payment break though, it’s important to check with your lender that you are eligible to do so as you could face a negative mark on your credit report if you’re not.
If you need any extra Specialist Mortgage Advice in Coventry, make sure to get in touch and we will see what we can do to help!
No one wants a divorce, but these things happen, for better or for worse. Divorces and separations are devastating and can easily spiral out of control when legal and financial matters get involved. As these things aren’t planned, there’s a lot of things to resolve before you go your separate ways and a lot of things that could go wrong along the way. In order to keep the divorce or separation as smooth as possible, it’s always best to know what lies ahead so you can prepare accordingly.
Here at your Specialist Mortgage Broker in Coventry, we know just the kind of mortgage issues you face during a separation or divorce. This is why we have compiled this list of the most common questions that we get from customers going through a divorce or separation and just how to deal with them. Rest assured, you’re not the only one going through these problems so we have extensive knowledge on the situation and know just how to help.
Agreeing to buy a home together is a huge financial commitment and is usually intended to be lifelong. This makes getting your name removed from a mortgage a lot harder as a matter of fact; making any changes to your mortgage is always a tedious task regardless of the situation. The only exception is at the end of your mortgage term when changing the agreement is easier.
When there are children involved, the property usually remains with the mother as she needs a place to raise the young ones, however, in some cases, it’s the other way around but either way, it may come down to whoever is “in situ” to take up the responsibility of the mortgage.
Removing an ex-partner’s name from a mortgage requires you to provide solid evidence that you will be able to meet your mortgage payments on your own. Every lender will look at your salary and your disposable income and then work out whether or not it’s realistic that you’ll be able to hold the mortgage payment fort on your own.
The lenders will also take a look at your ex-partner’s affordability and check whether or not they will be able to afford a mortgage on their own after the split. A full affordability assignment is carried out for both you and your ex-partner regardless of whether you have kept up-to-date with your mortgage payments in the past or not.
Keep in mind that since the property was bought jointly with an ex-partner, your lender can pursue either of you in the event of mortgage arrears.
Taking your name off the mortgage is quite similar to how you remove your ex-partner’s name. Although, in this situation, you are the one that is trying to vacate the property and move on which can sometimes create some unique difficulties.
Removing your name usually creates difficulties as you will need consent off your ex-partner that you can take your name off the mortgage. There’s also the issue of your lenders having to approve of you taking your name off. They decide this after a full affordability check on your ex-partner to check whether they’ll be able to afford their mortgage payments or not.
If your ex-partner gives consent for you to take off your name from the mortgage and are also capable of making the mortgage payments on their own, you will inevitably have to start looking for a place of your own. When you eventually find a place, your lender will consider your mortgage payments from your old property into consideration. There are a number of lenders that will have strict lending criteria while others may be even stricter. This why getting a suitable lender for yourself can prove to be quite difficult. Luckily, Coventrymoneyman takes your situation into consideration squarely which is why you should approach us when going through a divorce or separation.
In a lot of recorded cases, a third party may come in to offer a helping hand with the mortgage payments. This third party is usually a family member that may decide to help out or in other cases, there may be a new partner that is willing to step in.
This isn’t always the situation as you might want to make all of the mortgage payments by yourself. There’s no problem with this choice, but don’t be ashamed of reaching out and getting Specialist Mortgage Advice in Coventry from an expert! Our Mortgage Advisors in Coventry are experienced in this specialist field. Getting help with your finances or with removing your/ex-partner’s name off a mortgage could take a heap of the stress off your back. We want the best for you at the end of the day.
This is another common question and the answer is yes, in fact, you can own multiple mortgages, however, before getting accepted for another mortgage, your lender will have to take a closer look at many different factors. When they are checking your file, they will be able to see that you are still linked to another mortgage (or have been recently).
They will examine just how much you are contributing to these mortgage payments and check whether or not you’ll be able to manage additional mortgage payments on top of them. Lenders also expertly factor in any other credit commitments that you have.
Lenders will also account the risk factor, for example, how likely is it that your home is repossessed because you couldn’t afford your mortgage payments. They won’t take any risks either.
If you’d rather get an affordability check before you directly approach a mortgage lender, you can approach a Mortgage Broker in Coventry like us. We will perform our own credit check and affordability measures to find out whether it’s realistic that you’ll be able to afford another mortgage.
We have Mortgage Advisors in Coventry that specialise in this field, so don’t hesitate to get in touch with us. We are more than happy to help.
Should you get Mortgage Advice in Coventry? It really depends on your personal & financial situation, however, sometimes it’s always best to get a second opinion from an expert.
As a Mortgage Broker in Coventry, our job is to try and help you save both time and money. Whether this is saving money on your current deal when it’s time to Remortgage in Coventry or finding you a great deal for your new property, most of the time we are able to help. We have over 20 years of experience within the mortgage world, so we know exactly where to look for the best deals.
There are lots of different reasons to why people may want to come to a Mortgage Broker in Coventry like us for mortgage advice. Quite a few of our customers come to us after being declined by their bank and need an expert’s opinion on their mortgage situation. Also, we get a lot of First Time Buyers in Coventry that need help getting the ball rolling.
Remember, no matter your mortgage situation, we are still here to help. Whether you are Moving Home in Coventry, Self Employed and struggling to get a mortgage, remortgaging or even interested in Buy to Lets, we may be able to help! All you need to do is get in touch and claim your free initial mortgage consultation in Coventry. We specialise in lots of different areas, once we know your situation, we will pass you onto a Mortgage Advisor in Coventry, and before you know it, your mortgage journey will be on the move.
Once we have taken some details off you during your free mortgage consultation, you will be passed onto one of our expert Mortgage Advisors in Coventry. They will help you through the process and even help you get an agreement in principle arranged if you need help with that. All you have to do is find a property that you want to make an offer on and then the rest will fall into place.
After you make your offer, we will compare mortgage deals for you. Your Mortgage Advisor in Coventry will look at your personal and financial circumstances and then try and find deals that will benefit you most. Throughout the whole process, we will right by your side to provide our full help and guidance whenever you need it.
As a reliable Mortgage Broker in Coventry, we always aim to provide an excellent level of customer service. Through a fast and friendly service, to being responsive at all times, we always go above and beyond for our customers, no matter their mortgage situation. When someone approaches us for Mortgage Advice in Coventry, we always consider every situation that we are faced with; no one gets turned away.
If you want to see more of our amazing customer reviews, feel free to check out our reviews page. We take pride in our customer service, it’s what keeps us moving forward as a business.
Your Mortgage Broker in Coventry is available from 8am – 10pm, 7 days a week! So, don’t ever hesitate to get in touch; our advisors will be waiting by the phone for your call.
Customer service is at the heart of our company, we work solely for you. For a free mortgage consultation, fill out our form on the contact us page or give us a call. We can’t wait to hear from you!
These days, people pay much closer attention to what their credit rating is. Consumer awareness of credit scoring is much higher than it used to be and we can confidently say that at least half of people who contact us for the first time have already looked at their credit report online.
There are many different credit reference agencies out there. The majority of people looking to use these services will have heard of Experian or Equifax, but we recommend potential new clients to use Check My File for a 30-day free trial. After your trial ends, it will be £14.99 a month and can be cancelled at any time. This report “sweeps” several of those reference agencies and brings together the information into an easily understandable colour-coded report.
Often when customers get in touch, we receive questions about if we will be doing a credit search on them. This is because they are aware that too many searches can have negative effect on their credit score. Lenders always run credit checks but we always seek a client’s permission before proceeding with one. There are 2 different types of credit searches that banks can run on a customer: hard credit searches or soft credit searches.
A hard credit search is a detailed analysis of your credit report. Any financial institution carrying out one of these needs to be granted your permission to do so. Because the lender is looking into your situation quite closely with a hard search, if you pass the credit score then it’s fairly likely that your application will also be successful. This of course, is a big advantage.
The only thing that can really go wrong from that point going forward, is if for some reason you cannot provide satisfactory documentation to backup the information you have given them or it turns out you have provided false details.
The part that really stings about a hard search though is that it leaves a “footprint” on your credit file. This means that anyone who looks at your report in the future can see you have had a search carried out. This isn’t a bad thing immediately, but if you have several footprints registered in a short period of time then it could look like you applying for lots of credit at once.
The footprint left behind does not state whether your application was successful or not, though lenders’ systems could wrongly assume you are being declined on a regular basis. In their minds they would think “Why else would you go to lender number 2 unless lender number 1 had said no?”.
Leaving a hard footprint on your record every now and again is no big deal so there’s no need to worry too much about this, just be careful not to have too many within a short space of time.
A soft credit search is a much simpler approach towards analysing your financial situation. Soft searches are usually carried out on price comparison websites to give you an indication of what products might be available to you, or if someone wants to verify your identity.
Some mortgage lenders do soft searches in the first instance, with more lenders switching to this type of search. Whilst the financial institution doing a soft search obtains less information about you than if they had done a hard search, being granted an agreement in principle from one of these lenders is still a strong sign that your full application will be accepted.
The benefit of soft searches is that whilst you will be able to see that someone has carried out a soft search on you if you check your credit file, these searches are not visible to other Financial institutions like banks.
This means that you can apply for an agreement in principle for a mortgage with it being very unlikely that this would damage your credit score, no matter if it’s successful or fails.
If you are looking to make an offer on a property, we always recommend that you have your mortgage agreement in principle in place prior to contacting the estate agent.
You want to give yourselves the best possible chance of securing the property you want at the lowest price so if you can present yourselves as having your finances in place then you are definitely putting yourself in a better position going forward.
Having the agreement in principle also sometimes puts the agent off trying to “cross-sell” their own in-house mortgage services to you.
Specialist Mortgage Advice in Coventry by Coventrymoneyman.
In simple terms, the higher your credit score is, the higher the chance you have of your mortgage application being accepted. But how exactly do you improve your credit score?
It’s worth remembering that no one is guaranteed to be accepted for a mortgage. This is because each lender has developed their own credit scoring system over the years, meaning you need to showcase a variety of different things to different providers. With this in mind, don’t worry too much if you fail with one lender as there are other mortgage lenders who may be more forgiving with their criteria.
It is the job of your dedicated Mortgage Advisor to match you to the right lender. The hope is always to get this done first time, though this can vary between the case and sometimes it requires a little more work than expected. Both you and your Mortgage Advisor in Coventry want the same thing which is for you to end up with the most appropriate and favourable deal for what you’re looking to do.
There are various different credit reference agencies in the UK, including Experian and Equifax. It would be a smart plan for you to check as many of these agencies as possible to get a better idea of your credit score. Also, there could be a chance that one of the agencies may be holding incorrect data. Checking with several agencies will help you identify anything that is wrong and allow them to be rectified.
There are some good practices listed below regarding things you can work on to improve your credit rating.
Having too many credit searches can have an negative effect on your score. This is because it shows lenders that you’re looking to borrow more money from other places, something they’re not fond of seeing.
Be especially careful when using price comparison websites, because they are major culprits of performing discreet credit searches on people. If you know you want to apply for a mortgage soon, it would be smart to avoid applying for any further credit until your mortgage is underway.
Being on the electoral roll adds a lot of points onto your score as it is a sign of stability, something the lender likes to see. Please make sure that your name is spelt correctly and that it’s your current address you are registered at, not a previous address. If you are not registered, doing so online is very easy.
If you max out your limit on a credit card each month, that will reduce your credit score. Using a credit card and paying off the balance in full each month will indicate to a lender that you are good at managing money, which works in your favour. Remember though, that maxing out your limit or even worse, exceeding an agreed card limit, does not look good to a lender at all.
Sometimes your credit score can make it seem like you’re living in two places at once. This happens if you have forgotten to tell one of your credit providers that you have moved to a new house. Make sure that all addresses are spelt correctly. If you have lived in a flat this can be tricky as the flat/apartment number can be formatted in a variety of ways.
Owning too many credit cards can also have a negative affect your score. If there are any cards you don’t use, contact the providers and get the account closed. In the short term, this can be a downside, as the credit scorers can’t tell if you closed the account or the credit provider. It’s one step back for two steps forward however, and this has benefits in the long run.
This is also a good practice as it reduces your chance of falling victim to fraud as you might not be aware that you have lost a card you don’t use often.
If you have a family member or ex-partner connected to you, their credit actions could also have an affect on your credit score, especially if they’re bad at handling their money.
Unfortunately, you won’t be able to get the financial association removed if the account is still live. To remove one of these links you need to make a request with one of the credit reference agencies. It may be worth receiving Specialist Mortgage Advice in Coventry from a Mortgage Broker as removing a family member or an ex-partner could be a difficult task without someone available to help you through it.
Many consumers feel credit scoring is an unfair way for lenders to assess applications. Lenders see it differently than this, as it is much cheaper for them to operate this way and computers give more consistent outcomes. Either way, this is the most common approach within the industry, so utilising these tips should help put you on the path to improving your credit score.
If you’re looking to increase your chances of your mortgage application being accepted the first time, then send an up to date copy of your credit report to your Mortgage Advisor in Coventry in advance. The more your advisor knows about your finances the better it is for you and the easier the process may be. Also, there are still some smaller lenders out there that do not use credit scores, instead opting to do it the old-fashioned, manual way, though they will still have certain rules about the number of defaults and CCJs they will allow.