How to make the next steps of moving home and arrange a new mortgage post COVID 19
1. Be Prepared – Speak to a Mortgage Broker in advance. Your broker will run number of affordability checks and advise you on your maximum mortgage capacity including all your options based on your current financial situation.
2. If you are employed and you earn overtime, make sure it is regular and consistent so that the lender can use good average amount when applying for your new mortgage.
3.If you are a director of Ltd Company, many lenders will use your Trading Net Profit and Salary instead of using just your salary and dividends. This may allow you to borrow much more and you do not need to draw all your profit out as a dividend in order to maximise your borrowing. Run this pass us and we will advise you on the best way to proceed forward
4.If you have taken payment holiday, do not apply for a new mortgage or extra borrowing as lenders may view this as a financial concern.
5.Check your Credit score. Make sure you are on the Electoral roll at your current address. If you are a first-time buyer with no credit, maybe think about taking out a small credit card to build your credit profile, but use it regularly! Always make sure your bills and credit cards are paid on time, set up direct debit. Missing a payment on your credit commitments can have an effect on when applying for your new mortgage.
6.If you own an Investment Property (Buy to Let), make sure you have savings to cover the rental voids and any essential repairs. Make sure all your rental income corresponds with your bank statements.
7.If you are looking to buy an investment property, research is really important. Search areas and properties that can achieve higher rental yield. Rental yield is the return you make or expect to make on a property. As a general rule, a rental yield of around 7% or higher tends to be considered a very good yield for a buy-to-let property. Here is how to work out rental yield: (Monthly Rental Income x12) ÷ Property Price x 100 = % Rental Yield. Typically, you will need 25% deposit plus extra funds for additional rate of stamp duty.
8.Don’t forget the protection! Your mortgage is probably one of your biggest commitments in life, so why take risks of not protecting? The Mortgage Choice will carefully review your options and put forward a package that will best suit you and your budget. We will make sure that we protect your income in the event of illness or injury, life insurance to cover your mortgage, critical illness cover to help you ease the financial burden if anything happened to you and lastly protect your dream home.
Your home may be repossessed if you do not keep up repayments on your mortgage
As with all insurance policies, conditions and exclusions will apply
You may have to pay an early repayment charge to your existing lender if you remortgage
We Can Help!
The Mortgage Choice is an appointed representative of Stonebridge Mortgage Solutions Ltd and can source the most appropriate cover from its panel of insurers with a free review of you overall protection and insurance needs. As with all insurance policies, conditions and exclusions will apply.
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