Forces Help to Buy Scheme (FHTB) Explained

Originally brought forward in 2014, following the successful launch of the Help to Buy Equity Loan Scheme, the government introduced a scheme that by design had the purpose of reducing the low rate of forces home ownership across the country.

The Forces Help to Buy Scheme in Coventry is available to Tri-Service members, the Royal Navy, Royal Marines, Army and Royal Air Force, so long as they can meet the criteria.

Further to this, the Ministry of Defence’s Defence Accommodation Strategy also comes into play with this, aiming to make sure everyone has equal access to a good standard of accommodation.

Outlined in the MoD’s strategy, is the positive impact that homeownership can potentially have on people with inherently mobile careers, with these including partner employability, stable education for their kids and also continuity, as members of the services move out of being in active service.

Though it was supposed to end back in 2019, we have seen a few extensions for the Forces Help to Buy Scheme in Coventry, with the government eventually turning this into an enduring policy, which will allow it to remain available to all service members, both now and in the years to come.

How does the Forces Help to Buy Scheme in Coventry work?  

The way that the FHTB Scheme will work, is that service personnel have the ability to borrow up to 50% of their annual salary, which will have a cap at £25,000, free from interest. They are able to use this, either as a means to buy their first home or if they are an existing homeowner, move home.

It is currently available to all regular personnel who have completed the required length of service, are not listed as a reservist or member of the Military Provost Guard Service, have more than 6 months of time left to serve at the time of application and that meet all of the correct medical categories.

That being said, there may still be exceptions to the criteria, especially when you are factoring in special medical and personal circumstances. To learn more about this and other information regarding a Forces Help to Buy in Coventry, please take a look at the government guidance website.

Possibly one of the best aspects of FHTB, is that you are not required to have any current savings of your own before you can use it to get onto the property ladder. You have the freedom to use this towards costs such as a deposit, solicitors fees, estate agents fees and even stamp duty land tax.

The handy news regarding deposit too, is that the vast majority of mortgage lenders will accept the funds from FHTB for doing so. It tends to be a much more relaxed scheme than other home buying schemes, with the loan from Forces Help to Buy in Coventry only requiring you to pay back over a period of 10 years.

How a Mortgage Advisor in Coventry May Be Able To Help

As an open & honest mortgage broker in Coventry, that has a deep love and respect for our service members across the United Kingdom and in Coventry, we’re here to support and help you on your home buying journey in any way that we are able to do so.

From your initial point of contact, all the way through until you achieve mortgage completion and even beyond, your dedicated mortgage advisor in Coventry will work hard to make sure that you are taken care of and end up with the best result for what it is you wish to achieve.

To learn more, you are welcome to book yourself in for a free mortgage appointment and we will see how we are able to help you throughout your home buying experience.

Note; The Forces Help to Buy in Coventry is not the same as a standard UK Help to Buy in Coventry or Shared Ownership in Coventry.

If you are both a current service member and homeowner that is looking to use Forces Help to Buy in Coventry for moving home, and are aged 55+, it may be worth looking at your options for equity release or retirement interest-only mortgages (RIO Mortgages), as forces pensions may prove to be beneficial in this regard.

To understand the features and risks of equity release in Coventry and lifetime mortgages in Coventry, ask for a personalised illustration.

A lifetime mortgage in Coventry may impact the value of your estate and it could affect your entitlement to current and future means-tested benefits. The loan plus accrued interest will be repayable upon death or moving into long-term care.

Do Gambling Transactions Look Bad on My Bank Statements?

Lenders will look out for a variety of things when it comes to assessing your bank statements. They do this in order to see what your spending behaviours are like to determine whether or not you will keep up with your mortgage payments or not. A common question we find crops up when speaking to customers is: “do gambling transactions look bad on my bank statements”.

Mortgage Questions to Consider

What has it got to do with the lender whether I gamble or not?

You might enjoy putting down an annual bet on the grand national or regularly use internet betting sites, as you can tell, there is nothing illegal about properly licensed gambling. It is known to be a popular hobby or pastime with many bookmakers advertising it on mainstream TV and radio.

If you have seen these adverts, you have probably noticed that they always urge customers to ‘please gamble responsibly’ and this is an important point you should think about when applying for a mortgage. It’s not the lender’s job to dictate your spending habits or moralise the ethical pros and cons of gambling, however, they do have a duty (underscored by mortgage regulation) to lend responsibly.

Think about it this way, if lenders need to prove to the regulators that they are making well-judged lending decisions, it’s fair for them to expect a similar approach when it comes to their personal finances. If you were lending your own money would lend it to the applicant who gambles or the one who doesn’t?

Is it still possible to get a mortgage if I’ve got gambling transactions on my recent bank statements?

As stated previously, it is not illegal to gamble. With this in mind, you will not be declined by a mortgage if you have the odd gambling transaction on your bank statements. The lender will decide whether these transactions are reasonable and responsible. They will look in detail of how frequent these transactions are, the size of the transactions in connection with the person’s income and the impact upon the account balance.

Having infrequent small gambling transactions that make little difference on a regular credit bank balance will not likely be seen as important. On the flip side, placing bets most weeks or being constantly overdrawn, the lender will view your spending behaviours as irresponsible and decline your application.

Is there anything else lenders wouldn’t want to see on my bank statements?

As you know, lenders will look at your bank statements to basically see how you manage your money and to help them determine whether they are confident in you managing payments or not.

Lender are financial institutions that either directly or as part of a wider group, usually sell current accounts, overdraft facilities credit cards and personal loans, therefore, you need to know that these factors all go towards wise financial planning. It’s good for a mortgage applicant to know how these facilities are managed. You might have an overdraft facility and occasionally use it, which is not essentially a bad thing, however, exceeding the overdraft limit regularly which is not so good. If you have excess overdraft fees or returned direct debits, these would be things lenders will look for and will show them that your account is not being managed well.

As well as this, lenders will also look for credit transactions from pay-day loan companies; “undisclosed” loan repayments (i.e. if you said on the application that you have no other loans but there is regular loan payments appearing, this could be an issue). They would also look out for any missed payments and they see how much of a typical month is spent in overdraft – i.e. you might go into credit on payday and for the rest of the month you are overdrawn, you need to wonder how you would manage with a mortgage.

What can I do to improve things?

You can be sensible and plan ahead if you can. Usually, a bank still request up to three months of your most recent bank statements. These documents will show your salary credits and all your regular bill payments. Because of this, it’s best that you avoid any of the situations above, especially if you are looking to apply for a mortgage in the near future. You could avoid gambling for short period and work on presenting your bank account in the best way.

Seeking help and support from Mortgage Broker in Coventry can be helpful because there are some lenders who may ask for fewer bank statements than others or may not request them at all. Despite this, lenders do still have the right to reserve the right to request bank statements in particular circumstances so it’s best that you be as prudent as possible when you are in the midst of any mortgage application. Remember, if you do gamble, please gamble responsibly!

Get in Touch With a Mortgage Broker in Coventry

In the circumstance where you are a First Time Buyer in Coventry who doesn’t have a lot of knowledge about mortgages, it’s you get some specialist advice from an expert Mortgage Advisor in Coventry. Throughout the process, your dedicated advisor will provide a helping hand with your application and work hard in getting you up to date so that lenders will be impressed.

Shared Ownership – What is it? How does it work?

The Shared Ownership scheme was introduced following the credit crunch in 2012, the scheme gives first time buyers and home movers the chance to buy a share of a property and then rent the remaining part of it.

Shared Ownership Mortgage Advice in Coventry

What is shared ownership?

Shared Ownership will let you take out a mortgage/purchase a share of a property. This is a percentage-based share; usually, you will have to own a share of at least 25%-75%. However, in recent times, some properties are letting you have a share as low as 10%.

You will also have to pay rent back on the remaining share of the property. Your mortgage bills should be lower as you’ve taken out a mortgage on a lower share, so you should be able to compensate for the rent payments.

Furthermore, since you’re taking out a lower share in the property, your initial mortgage deposit should be lower.

Maybe partial homeownership is the route that will help you get onto the property ladder.

How does the scheme work?

Although it can differ based on your credit history, since it’s likely that you’re only purchasing between 25%-75% of the property, the minimum deposit required should be lower.

Here’s an example of how Shared Ownership would work. If you take out a 50% share of a property that’s valued at £250,000, you’ll only need to borrow £125,000 for your mortgage. In addition to this, say that you’re required to put down a 5% deposit, you’ll only have to supply £6,250 rather than the whole £12,500 if you were to take out a 100% mortgage on the same property.

Once your Shared Ownership papers have gone through and you’ve put down your deposit, just like any other mortgage type, you’ll start paying back your mortgage each month. You’ll also be paying rent to the housing association that is linked to the property.

In theory, your combined mortgage and rent payments shouldn’t be as much as if you were to have taken out a 100% mortgage. Your mortgage advisor in Coventry can go through the costs with you.

Costs and fees

With any type of mortgage, you’ll be faced with a few different costs and fees; the same costs should apply to Shared Ownership.

You’ll have to consider obvious set-up/mortgage arrangement fees and possibly booking fees. There may also be a stamp duty charge on your property, it depends on the property price and how much you’re buying it for. You can speak to your mortgage advisor in Coventry about stamp duty to find out which threshold your property is in. Don’t forget about solicitor and legal fees too.

Costs may vary depending on the property that you’re buying. Deposit size, monthly payments, arrangement fees will differ from property to property.

How can I apply?

You’ll have to match the Shared Ownership criteria before you can move forward with your application:

• You must be at least 18 years old.
• If you live outside of London, your household annual income must less than or equal to £80,000. If you live in London, this is upped to less than or equal to £90,000.
• You can’t have ownership over another property during your Shared Ownership mortgage application. You must be a first time buyer in Coventry or in the process of selling your current property.
• If you can afford a house on the open market, you will not be able to take out a Shared Ownership mortgage. It was introduced to help struggling homebuyers.
• You must prove that you are not in any kind of arrears, this includes both mortgages and rent.
• You’ll need to show evidence of a good, clean credit history. This means that you may struggle if you have a CCJ (county court judgement) in your name or have had past credit issues.
  

Although this may seem like a long list of requirements, you must remember that most of the other home buying schemes are the same or have an even longer list!

At the end of the day, the scheme was made for a specific target audience, so if you don’t match it, it probably isn’t for you.

Speak to a Shared Ownership Mortgage Advisor in Coventry

Our team has been working as a mortgage broker in Coventry for over 20 years now. Along the way, we have helped many applicants secure Shared Ownership mortgage products – it’s one of our many specialities.

Shared Ownership fits within the government-led ‘Own Your Home’ project. There are many different schemes available through this project; you can find out more information here: www.ownyourhome.gov.uk

We offer a free Shared Ownership mortgage appointment to every customer. Book online today and speak with a mortgage advisor in Coventry at a time that suits you.

Why Use a Mortgage Broker in Coventry?

We Aim to Take Your Stress Away

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.

When Should I Get Mortgage Advice in Coventry?

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.

Free From Estate Agents, Banks or Building Societies

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. 

Building Customer Relationships

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. 

What is a mortgage agreement in principle and how can it help with my mortgage?

Agreement in Principle Mortgage Advice in Coventry

First things first; What is a mortgage agreement in principle?

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:

1. Negotiating Power
2. Avoiding Disappointment
3. Knowing Your Limits

Negotiating Power with a Mortgage Agreement in Principle

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.

Avoid Disappointment with a Mortgage Agreement in Principle

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.

Knowing Your Limits with a Mortgage Agreement in Principle

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.

Expert Mortgage Advice in Coventry

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.

The Popularity of Gifted Deposits

The benefits of receiving a gifted deposit

We tend to find nowadays that more parents are gifting a deposit than ever before. Realistically, the “Bank of Mum & Dad” is now within the UK’s top 10 biggest lenders.

It’s no surprise how many younger people struggle to save enough for a deposit and lean on their parents or friends to help gift part of the entire housing deposit. Some parents or other family members, such as grandparents, are now gifting amounts upwards of £24,000.

Extra assistance to get a mortgage

Hundreds have become reliant on a family member every year, hoping to help them onto the property ladder. When speaking to some customers, we found that they felt a sense of personal responsibility.

It’s no surprise why many need that extra support, an increase of property prices, that has gone way over the average wage, leaving many unable to save for the deposit on their first home while coving the expenses of rent and utility bills. That said, it’s become more apparent if there is only one income supporting the household or being a sole applicant.

Escaping the rental cycle & getting a mortgage in Coventry

While renting may seem helpful in the short term, it can harm any chance people have to save for a mortgage deposit in the long run. Some decide to move back in with their parents to help save up the necessary costs for a larger deposit. Surveying 1600 parents who had helped their children out, many went on record as saying they had used their savings to do so. 

Another concern is that some said they had withdrawn from their pension schemes or equity to gift a deposit. Essentially, this is them putting forward any inheritance their child would receive.

To read about what could be available to you, read our help to buy service page, or check out our first time buyer in Coventry service page. If you like to arrange to speak with a mortgage advisor in Coventry, please feel free to get in touch with us today. 

Should I Get Mortgage Advice in Coventry?

If you are taking on the mortgage process, you may be wondering whether or not you should take out mortgage advice in Coventry. At the end of the day, it’s all down to personal preference, as well as your finances. In many cases, however, it can be beneficial to get a second opinion.

It should be the job of a mortgage broker in Coventry to save you both time and money, making your process as stress-less as they can. This is something we pride ourselves on as a company. Whether you’re buying a new home or remortgaging an existing one, a lot of the time, we are able to help.

We have been working within the mortgage industry for a long time, with over two decades of experience. This means we know a variety of mortgage situations inside and out, with knowledge on exactly where to find the best mortgage deals for you.

Why do people get mortgage advice in Coventry?

There are all kinds of different reasons as to why people may get in touch with an expert mortgage broker in Coventry for mortgage advice in Coventry.

We sometimes see customers getting in touch with us after they have already spoken to their banks mortgage advisors in Coventry and been declined. As such, they may find themselves in need of an expert, unbiased opinion regarding their mortgage situation.

Another area we regularly help with, is first time buyers mortgages in Coventry. We love being able to help people find their footing on the property ladder with their first ever home purchase! It can be a stressful process and we try to make it as simple as possible.

No matter the mortgage situation you are in, whether self employed and struggling to evidence income, moving home and stuck in a property chain, looking to increase your portfolio of buy to let mortgages in Coventry or even something else, a mortgage broker in Coventry is here to help.

After Your Free Mortgage Appointment

When you get in touch with us, you reap the benefits of a free mortgage appointment with an expert mortgage advisor in Coventry. They will sit and chat with you about your plans for your property owning future and gather initial information from you, to help with your process.

It’s the job of a dedicated mortgage advisor in Coventry to help you through every single step of your mortgage process. This includes obtaining an agreement in principle for you, if you need us too, which can typically be done within 24 hours of your initial mortgage appointment.

From there it’s on to the next stage of your journey, whether that be making offers on a property you would like to buy or looking at better deals with a mortgage advisor, if you are instead looking to remortgage in Coventry on your home.

Once you have progressed through this next step of your process, your trusted mortgage advisor in Coventry will be able to compare mortgage deals for you, on your behalf. They will look at both your financial and personal situation, finding the deal that is likely to benefit you the most.

No matter what, your mortgage broker in Coventry is here to help, staying by your side throughout every leg of the journey. No question is a silly question and we will answer all of your queries and concerns as promptly and clearly as we can, to keep you at ease during your experience.

Our Mortgage Advice Service in Coventry

As an open & honest mortgage broker in Coventry, it is always the aim of our employees to deliver a high level of customer service. Through providing a fast and friendly service and being extremely responsive, we go the extra mile for our customers, no matter their circumstances.

When a customer gets in touch with us for mortgage advice in Coventry, we always consider every situation that is presented to us. Whilst we may not be able to help everyone, we will do everything in our power to ensure it can go in your favour.

Please feel free to take a look at our amazing customer reviews, as a way to see the levels of customer service we are able to provide. How we deliver our customer service is something that is at the heart of what we do, it motivates us everyday.

Mortgage Advisor Availability

Your trusted and dedicated mortgage broker in Coventry is available 7 days a week, from morning until late, including weekends and some bank holidays, subject to appointment availability.

Do not ever hesitate to get in touch, give us a call or use our online booking form and we will see how we can help!

Agreement in Principle & Soft Credit Searches

Credit Search Mortgage Advice in Coventry

Nowadays, people focus a lot more on their credit rating. We have seen an increase in consumers becoming aware of credit scoring and this has been evident here at Coventrymoney with many people who get in touch and have looked at their credit report online.

There are a variety of credit reference agencies out there. Experian and Equifax is the most popular ones that people use. As a Mortgage Broker in Coventry, we recommend potential new clients to use Check My File for a 30-day free trial. It will then be £14.99 a month after your free trial but you can cancel this at any time. This report pulls together the information into an easily understandable colour-coded report.

When customers contact our team, we usually receive questions about whether we will be doing a credit search on them. As mentioned, many people are aware of credit scoring and will also know that too any searches can have a negative impact on their credit score. Lenders always run credit checks, however, we do ask for the client’s permission before its carried out. Hard credit searches and soft credit searches are the two different types of credit searches that banks can run on a customer.

Credit searches

What is a hard credit search?

For a detailed analysis of your credit report, a hard credit search would be carried out. This type means any financial institution will need your permission for this to happen. The lender will be looking in depth into your situation with a hard search. Passing the credit means there is a high chance that your application is also successful which is a huge advantage.

One drawback that can happen is if for some reason an applicant cannot provide satisfactory documentation to support the information you have provided or they find that you have put forwarded false details.

Furthermore, a hard search will leave a ‘footprint’ on your credit file which means any who views your report in the future will be notified that a search has been carried out. Keep in mind that this isn’t a bad thing immediately, however, it can be if you have multiple footprints registered in a short period of time this could look like you have applied for lots of credit at once.

Even though the footprint left doesn’t determine whether your application was successful or not, lenders’ systems may automatically assume that you are being declined. From their perspective, they would think why you would go to a second lender, unless the first lender had said no.

Having a hard footprint on your every now and again is not a big issue which you don’t need to worry about but you need to be careful that you don’t have too many within a short period of time.

What is a soft credit search?

The analysing aspect of a soft credit search is a lot more straightforward. You will find soft searches on price comparison websites which can give you an idea of what products might be on offer to you or if someone wants to verify your identity.

Many mortgage lenders carry out soft searches initially, with most lenders switching to this type of search. The financial institution carrying out a soft search does mean they obtain less information compared to a hard search, however, if you are granted an agreement in principle from one of these lenders, it still increases the chances of your full application being accepted.

You may find that soft searches are more discreet because you can see that someone has carried out a soft search if you check your credit file, however, this won’t be shown to other financial institutions like banks.

With this, you will be able to apply for an agreement in principle for a mortgage because it’s pretty unlikely that this would harm your credit score, regardless if it’s successful or not.

What is a mortgage agreement in principle?

For those that are looking to make an offer on a property, we strongly advise that you have your mortgage agreement in principle in place before contacting the estate agent.

It’s key that you put yourself in the best possible position of securing the property you want at the lowest price by having your finances in place which will result in you being in a better position going forward.

With an agreement in principle in place, it will prevent the agent to “cross-sell” their own in-house mortgage services to you.

Is your situation a little out of the ordinary?

If you feel that your situation may be too complex for a Mortgage Broker in Coventry, like ourselves, to sort out, please don’t hesitate to get in touch. Here at Coventrymoneyman, we have extensive experience and rich knowledge under our belt that has allowed us to work with customers that are from a variety of circumstances. Therefore, it’s very likely we have come across a situation like yours before and our team can provide Specialist Mortgage Advice in Coventry to help with this.

Mortgage Advisor in Coventry

How to Improve Your Credit Score in Coventry

Credit Score Mortgage Advice in Coventry

The general rule around your credit score is that the higher it is, the higher the chance you have of your mortgage application being successful. In light of this, you may be wondering what you need to do in order to improve your credit score.

First of all, not everyone is guaranteed to be accepted for a mortgage. This is due to the fact that every lender has built their own credit scoring system which results in an applicant needing to demonstrate various things to a range of providers. Therefore, if your application gets declined by one lender, don’t panic, as there are lots of other mortgage lenders who may be lenient with their criteria.

This is where an expert mortgage advisor can help. They can look at your situation and financial background in order to match you to the most appropriate lender. Here at Coventrymoneyman, we always aim to pair you with the right lender the first time around and work hard in overcoming any obstacles that may occur in your situation.

There are a variety of different credit reference agencies in the UK, such as Experian and Equifax. It would be best if you check as many of these agencies as possible in order to have a good idea of your credit score. As well as this, you may find that one of the agencies could be holding incorrect data which means you can see if there is anything incorrect information and will be able to get it rectified.

Below are some helpful ways when it comes to improve your credit rating.

Improving your credit score in Coventry

Avoid unnecessary credit searches

Running a large number of credit searches can have a negative impact on your score. From a lender’s point of view, they will see this as you’re looking to borrow more money from other places which is something that will not work out in your favour.

Be conscientious when it comes to price comparison websites as they do have a reputation for carrying out discreet credit searches on people. If you are looking to apply for a mortgage in the near future, it would be best to avoid applying for any further credit until your mortgage is underway.

Check you are on the voter’s roll

One way to gain lots of points on your credit score is being on the electoral roll as it shows stability which is something a lender favours. It’s important to check all your information like your name is all correct and you’re registered at your current address, not a previous one. You can easily register to be on the electoral roll online.

Don’t run close to your maximum limit

Going over your maximum limit on a credit card each month can harm your credit score. Therefore, using a credit card and paying off the balance in full each month will demonstrate to a lender that you are good at managing your finances. Keep in mind that maxing out your limit or even worse, exceeding an agreed card limit, will not look good from a lender’s perspective.

Check your address history is keyed correctly

A credit score can make it look like you’re living in two places at once, which can be down to a number of things. You may have forgotten to tell one of your credit providers that you have moved to a new house or you may have not spelt your address correctly. This can be an issue if you have lived in a flat as the flat-apartment number can be formatted in many different ways.

Close down any unused credit accounts

Having too many credit cards can also have a negative impact on your score. Therefore, you need to go through the cards and see which ones you don’t use anymore. From this, you will need to get your account closed which can be done by getting in touch with the providers. Initially, this can be a disadvantage, because the credit scorers won’t be able to differentiate whether you close the account or the credit provider. Despite this, it’s a temporary issue that will reap its benefits in the future.

By doing this, you are reducing the risk of falling victim to fraud as you might not be aware that you have lost a card you don’t use often.

Remove financial links to others

In the case where you are financially linked to a family member or ex-partner, their credit actions could also have an impact on your credit score, in particular, if they aren’t the best at handling their money.

The unfortunate case is that you won’t be able to get this financial link removed if the account is still live. In order to detach yourself from this link, you will need to make a request with one of the credit reference agencies. Seeking Specialist Mortgage Advice in Coventry from a mortgage broker can be really beneficial as it can be a challenge removing a family member or an ex-partner, therefore, having an expert by your side to guide you could be the best option.

Credit score

There is a general argument from consumers that credit scoring is an unfair way for lenders to assess applications. The counter-argument from lenders is that it is much cheaper for them to work this way and computers give more consistent outcomes. Regardless of this, it is the most common method in the industry which is why it’s best that you look at utilising these tips to help you with improving your credit score.

One way to increase your chance of your mortgage application being accepted the first time, send an up to date copy of your credit report to your dedicated mortgage advisor in Coventry beforehand. Your advisor wants to know the ins and outs of your finances and this will help towards making the process more straightforward. Furthermore, there are still some smaller lenders in the industry who do not use credit scores, as opposed to going for the older, manual way, but they will have set rules in terms of the amount of defaults and CCJs they will allow.

Mortgage Advice in Coventry

Mortgage Payment Holidays | Mortgage Advice in Coventry

Mortgage payment holidays

At the start of the Coronavirus pandemic, the Government gave us the promise that all borrowers would be granted a three-month mortgage payment holiday if deemed necessary. Most lenders followed the Government’s guidelines and did everything in their power to help their borrowers during these hard few months.

We have thought carefully about the likely possibilities for your mortgage over the next few months and are working very closely with all of our lenders to ensure that if any changes occur, we are able to inform you right away and recommend the most ideal option for you to take so that you still feel safe and happy with your mortgage.

We feel like now is a good time to talk about mortgage payment holidays as everyone is asking about them and how they work.

What is a mortgage payment holiday?

A mortgage payment holiday is simply a period where you don’t have to pay your monthly mortgage payments. This is agreed between you as the borrower and your mortgage lender, bank or building society. In this current situation, it should be about three months.

You will still have to make all of these payments. The interest that you defer over the set period will be added on top of your loan amount whilst your capital balance will not decrease. So both your total mortgage amount and the interest on it will increase.

When you feel that you are ready to continue with your mortgage payments, either your monthly payments are recalculated at a slightly higher level or your mortgage term is extended. Lenders tend to prefer in recalculating your repayment as extending your mortgage term could put you past their standard retirement ages.

Some lenders may allow you to pay off a lump sum later on in the year to let you get back to what you were paying monthly before the mortgage payment holiday. Mortgage payment holidays are accessible for borrowers with both residential and Buy to Let mortgages in Coventry. This really helps out landlords as they have some assistance if rental payments are affected.

The Government’s proposal

Here is what the Government has said after the COVID-19 outbreak:

• Mortgage lenders will offer an automatic three-month mortgage payments holiday for borrowers who have been impacted directly or indirectly by COVID-19
• The mortgage payment holiday will apply to customers who are up to date on their payments, not in arrears, and wanting to self-certify that they are impacted by COVID-19
• This means that lenders will not complete an income and expenditure assessment, or an assessment of alternate payment options as ordinarily required under MCOB
• This proposal will allow lenders to be more responsive to customer needs and offer forbearance in a simple way to customers in an environment where the operation of collections teams made be also impacted by COVID-19
• Customers will be made aware that interest will accrue in the holiday period and they will need to make up deferred payments in the future
• Customers who wish to undertake a full assessment of their ability to pay or financial difficulty may still do so.
  
  

How do I apply for a mortgage payment holiday?

Before you go directly to your lender, we recommend that you talk to your Mortgage Advisor in Coventry first. This is because they can look through everything for you and talk you through the options available for you that will benefit you most financially. As a Mortgage Broker in Coventry, we know all about mortgage payment holidays and the dos and don’ts, so get in touch and receive a free mortgage consultation before anything else.

If you want to go directly to your lender and you are up to date with your mortgage payments, not in arrears and have been directly affected by COVID-19, here are the steps you should take:

• The customer would contact the lender and inform them that they are being impacted
  by COVID-19
• The lender would accept these details from the customer and offer an automatic
  three-month mortgage payment holiday
• No evidence is needed for the lender
• The lender makes the customer aware that interest will accrue and will be contacted at the end of the three months to complete an assessment of the customer’s circumstances
• At the end of three months, an arrangement to pay will be agreed with the customer according to their circumstances to recover any shortfall, also ensuring that the mortgage remains affordable and sustainable
• The lender notifies the customer that if they wished to complete a full assessment now, there may be other forbearance options more suitable to the customer.
  
  For more information on how COVID-19 may affect your mortgage, click here.
  
  

Will a mortgage payment holiday impact my credit score?

Yes, it can produce a negative impact on your credit score, but it shouldn’t in this situation. You are applying for a mortgage payment holiday because of a virus so your lender should make sure that it will not do any damage.

Before rushing into this, you will need confirmation that it will not damage your score. To do this, you need to contact your lender directly and ask this question, making a record of the date and time and the name of the person that you spoke to. This way, if anything changes in the future, you have a reference to what was originally said.

Will I still be able to remortgage or take a product transfer with my lender?

The answer to this question has changed over the last couple of days. Even when the virus wasn’t seen as a threat, you could still remortgage and transfer products as usual. Now, everything has changed and lenders are no longer offering any remortgage deals and product transfers. Things have changed so quickly!

This means that borrowers who are coming up to the end of their existing product could be forced to move onto the higher lender variable rates as there are no other lower deals available. So people who act too early could find themselves on a mortgage payment holiday that accrues a high-interest variable rate.

This is why we recommend speaking to us, your expert Mortgage Broker in Coventry. We are here to provide you with open and honest Mortgage Advice in Coventry through these next few tough months for you and your mortgage. In general, it helps if you can arrange your mortgage transfer first then enquire about your mortgage payment holiday.

What are my other options?

There are other options available for you to take to help you meet your monthly mortgage payments over these next few months. Your lender may be generous and offer you a temporary switch over to an interest-only to help you save some money on your monthly payments. This will not add any further to the loan amount by still servicing the interest each month.

On the other hand, you may not need to switch all of your mortgages to interest-only and it may be that putting your mortgage on this basis could give you that extra bit of breathing space that you need.

If you have savings, remortgaging onto an offset basis is another option. You could end up reducing your monthly payments whilst keeping your savings untouched.

An example would be that if someone had a £200,000 loan and savings account with £50,000 in, they would only pay interest on £150,000. This option could massively reduce your monthly mortgage payments.

Other options include a straight remortgage to another lender, working out costs of any repayment charges or simply extending the term of your mortgage. It’s completely up to you and you should choose whatever you think suits you better. This is where a Mortgage Broker in Coventry will come in handy, as they will talk you through all of your options and help you make a choice. They want the best for you and want to make sure that you feel comfortable and secure at all times during these tough few months.

Get in touch with a Mortgage Advisor in Coventry and discuss all of your mortgage options regarding mortgage payment holidays. We love mortgages and we love helping you! Get through these few hard months of mortgage payments with help from your Mortgage Broker in Coventry, Coventrymoneyman.

Mortgage Broker in Coventry