Category: Mortgages

A flat above a commercial premises like a shop can be an attractive location with certain benefits.

It can give you great value for money since they’re usually available at lower prices than other flats in the area.

They appeal to renters who like central locations near amenities and can be a good option for landlords.

Here’s everything you need to know about getting a mortgage on a flat above a shop, how to submit a robust application, and how to ensure you get a good offer.

Can You Get a Mortgage on A Flat Above a Shop?

Yes. Many lenders, although not all, will approve your application for a mortgage on a flat above a shop. Various specialist and mainstream lenders will consider this type of home loan.

However, you’ll have a limited pool of potential lenders since most will be concerned about the property’s saleability in the event of repossession.

Lenders ideally want properties that can sell quickly and easily to recover their investment if you default, which can be hard to do if the property is less desirable.

Factors that can make flats above commercial premises harder to sell include

• High risks of loud noises
• Smells
• Unsocial operation hours
• Drunken behaviour in case of takeaway shops or drinking establishments
• Increased risk of fire from commercial properties like restaurants

Some lenders reject applications for such properties because they fear the property will lose value.

Most flats above shops also feature leaseholds. The lender would need to invest additional time and money examining the lease terms to pre-empt possible changes, so they simply choose not to lend on such properties.

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How Much Can You Borrow with A Mortgage on A Flat Above a Shop?

The amount you can borrow will depend on your income and expenditure. Since the property is above commercial premises, it can also indirectly impact how much lenders are willing to offer.

Lenders usually offer up to 4.5 times your income for residential mortgages, with some offering as much as six times your income.

However, you may be limited on the income multiples you can access for a flat above a shop since there will be fewer lenders for such properties than a standard residential mortgage.

Different lenders have their way of calculating income and affordability to determine how much you can borrow.

Some will consider any supplementary income you have, while others will only consider your regular income or self-employment accounts.

What Are the Eligibility Factors for Getting a Mortgage on a Flat Above a Shop?

Each lender can have different eligibility criteria, but most usually consider factors like:

• Your employment status
• Your credit status – Lenders can view you as a riskier borrower if you have bad credit, limiting those willing to lend to you.
• Your deposit level

Most lenders will require a deposit of at least 15% for a flat above a shop due to the resale value concerns.

The deposit can be higher for other commercial premises like cafes, offices, bars, and restaurants.

Lenders will also look at other factors, including:

• Access and security of the flat
• The location of the flat. Some locations are more desirable than others.
• Whether there is at least one floor between the flat and the shop or if it’s directly above it.
• The types of shops adjacent to the one underneath the flat.
• Whether the shop and the flat have separate title deeds.
• Whether the property is self-contained.
• The length of the lease.
• The operating hours of the shop.

Can You Get a Mortgage for the Flat and Shop?

Yes. If you’re looking to purchase both the flat and shop below it, there are a couple of options you can consider.

These include:

• Semi-commercial Mortgage – Also called mixed-use or hybrid mortgages, semi-commercial mortgages can help purchase or refinance any building or land used for residential and commercial purposes. Applications for such mortgages are assessed on their own merits and the operating profit the property will generate.
• Taking out two mortgages – If you plan to let out the shop and live in the flat upstairs, you may want to consider getting two separate mortgages. You can get a residential mortgage for the flat and a commercial mortgage for the shop. It can be a complex process involving splitting the title deeds and affordability calculations. You’ll want to consult an experienced mortgage advisor or broker to help manage the applications and offer guidance on your options.

Related reading: 

• Reasons for remortgaging.
• Remortgaging to release equity.
• Remortgaging to buy another property.
• Remortgaging with bad credit.
• Remortgaging for home improvements.
• I own my house outright can I remortgage? 
• Capital raising mortgages.

Can You Get a Second Home Mortgage for A Flat Above a Shop?

Yes. Getting a second home mortgage for a flat above a shop should be similar to any other residential second home mortgage.

However, lenders consider second homes as a higher risk.

They may require you to put down a higher deposit or interest rate if you’re still paying a mortgage on your primary home.

This is because people are more likely to default on the mortgage for their second home if they face financial difficulties.

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Can You Get a Buy-to-Let Mortgage for a Flat Above a Shop?

Yes. A buy-to-let mortgage will be necessary if you want to mortgage a flat above a shop as a rental opportunity.

Most buy-to-let mortgages are interest-only.

This means you pay the interest on the loan monthly and pay off the original loan amount at the end of the term.

Lenders will determine your affordability for the buy-to-let mortgage by looking at the projected rental income of the property.

The lender will require an estimation of the rental income to determine whether you can afford monthly payments.

Most lenders require the rental income to be between 125% and 145% of the monthly interest payments.

They also examine your non-rental income and conduct stress tests to determine if you can cover any fluctuations.

Final Thoughts

A mortgage on a flat above a shop is similar to a standard residential mortgage.

However, it can be more challenging, depending on your circumstances. Working with an experienced mortgage broker can increase your chances of finding the best deal possible from a suitable lender.

Call us today on 03330 90 60 30 or contact us to speak to one of our friendly advisors.

Auctions are naturally fast-paced and competitive, so finance options must be quick and efficient when buying a property at auction.

Standard mortgages don’t work for auction finance since they take too long, typically a few months, to arrange, process, and finalise.

Auction finance is more suitable for buying a house at auction since it’s usually quicker to arrange.

Here’s everything you need to know about how to get finance for an auction property.

What Is Auction Finance?

Auction finance is a bridging loan that can help you buy a property at auction. It’s usually quick to arrange and can be faster than a regular bridging loan agreement.

Auction finance offers a much quicker turnaround, making it ideal for buying at auction where timing is crucial.

The sale is usually agreed upon when the hammer falls if your bid is successful, meaning you’ll not have much time to raise the necessary funds.

When buying an auction property, you must immediately put down a 10% deposit and pay the remaining 90% within 28 days.

It would help if you had your finances in place before the deadline to avoid losing your deposit. Auction finance is well suited to meet these deadlines.

How Does Auction Finance Work?

Lenders offer auction finance on a short-term, monthly, interest-only basis.

You can get a decision in principle within 24 hours when you apply and have the funds in your account within 7 to 14 days.

You can arrange the funding in advance so you know how much your budget is before the hammer falls.

Auction finance lenders will require you to have another asset or property as security or enough deposit and evidence of a clear exit strategy.

An exit strategy involves how you plan to repay the debt at the end of the loan term. It can include selling the property or remortgaging.

The term for auction finance is usually shorter than a standard mortgage and can range from 1 to 24 months or up to 36 months among some lenders.

What Interest Will You Get with Auction Finance?

Auction finance usually features higher interest rates than mortgages, but they can be similar to what you’d get on a regular bridging loan.

The exact interest amount will depend on how the lender charges interest and the quality of your auction finance application.

Lenders offering auction finance can charge interest in various, including:

• Rolled up – The lender can tally up the monthly interest and add it to the loan amount at the end of the term. You’ll then pay the cumulative total in full at the end.
• Monthly – You pay the interest monthly, and the total debt is due at the end of the term.
• Retained – At the beginning of the term, the lender adds the monthly interest payments to the loan amount to calculate how much you will owe. You’re then required to pay for everything at the end.

How Can You Get the Best Deal on Auction Finance?

You can take various steps to put yourself in the best position to secure auction finance.

These include:

Getting Your Documents in Order

Lenders will need to see various documentation as proof, including:

• Proof of ID – A passport or driver’s license and proof of address or residency.
• Proof of Exit Strategy – You’ll need an agreement in principle if you plan to remortgage. If you use a non-standard exit strategy like inheritance or investments, the lender will require proof that the funds will enter the account in a set timeframe.
• A Valuation Report – Getting the property valuation in advance may not be necessary, but some lenders may require you to pay for the costs.

Checking Your Credit Profile

Download your credit report to correct any inaccuracies and have outdated information removed.

Bad credit isn’t a significant issue, provided it doesn’t interfere with your exit strategy. However, improving your credit can increase your chances of getting a good deal.

Speaking to a Specialist Auction Finance Broker

Consulting a broker specialising in auction finance can help boost your chances of success. The broker can offer bespoke advice, help you find the best lender, and negotiate the best deals.

They can guide you on the proper steps, including making a winning application.

What Are the Eligibility Criteria for Auction Finance?

Lenders will assess your eligibility based on the following factors:

• The deposit – Most lenders will require you to put down at least 10-25% of the loan amount as a deposit. The larger your deposit, the lower the interest rates you will have to pay.
• Your exit strategy – A strong exit strategy will increase your chances of getting an excellent auction finance deal. Lenders will want to see evidence of the value of the property you’re buying, its saleability, or an agreement in principle from a mortgage lender as proof that you have a viable exit strategy in place.
• Your credit rating – Your credit rating won’t affect an offer as long as any outstanding debts or adverse credit doesn’t impact your ability to repay the loan. However, good credit can boost your chances for a good deal with lower interest rates.
• Your experience in property – Having experience with similar property purchases and a strong track record can boost your eligibility. However, you can still qualify for auction finance as a first-time buyer. You can also use any other property you own as security to increase your creditworthiness.

You can still qualify even if you don’t meet all the above criteria. Lenders offering auction finance are very flexible and can assess applications on a case-by-case basis.

Related reading: 

• Reasons for remortgaging.
• Remortgaging to release equity.
• Remortgaging to buy another property.
• Remortgaging with bad credit.
• Remortgaging for home improvements.
• I own my house outright can I remortgage? 
• Capital raising mortgages.

What Properties Can Buy with Auction Finance?

You can use auction finance to buy various property types at auction, including:

• Commercial
• Residential
• Unmortgageable properties
• Mixed-use
• Land (with and without planning permission)
• HMOs
• Agricultural properties

Final Thoughts

Once you’ve identified a property you want to bid on, consult a qualified and experienced auction finance broker.

They can assess your needs and circumstances and have the expertise to help you land a good deal.

Call us today on 03330 90 60 30 or contact us to speak to one of our friendly advisors.

A chancel repair search is essential if you’re considering buying a property in England or Wales.

It ensures you’re aware of any obligations that may affect the property and can help protect you from legal issues or unexpected costs that can run into hundreds or thousands of pounds.

Here’s everything you need to know about chancel repair searches.

What Is a Chancel Repair Search?

A chancel search, also called a chancel repair liability check, allows you to know whether a property is liable for contributing towards repairing the chancel of a parish church.

The chancel is the space around the altar at the east end of the church.

Chancel repair liability originates from an ancient medieval law that made property owners, instead of monasteries, responsible for church repairs.

Under the law, parishes in England and Wales can demand money from owners of particular properties on former monastery land to fund repairs, with costs reaching thousands or millions of pounds.

For example, in 2009, a couple was found liable for £230,000 worth of repairs to the church.

A chancel repair search is a crucial due diligence step that can help protect you from significant and unexpected costs linked to this ancient liability.

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Which Properties Are Liable for Chancel Repair?

Chancel repair liability places an obligation on the owners of specific parcels known as glebe lands. These are parcels within an ecclesiastical parish initially granted to support a parish priest.

Although the liability was forgotten or overlooked over the centuries as the land was sold, bought, and divided, it can resurface during modern conveyancing processes.

Around half a million properties in England and Wales can be liable, even if it’s not mentioned in the title.

It’s relevant to old and new properties since it applies to the land on which the property sits, and homeowners may be liable if a local church is nearby.

Such homeowners are called lay rectors, and whether they know it or not, are responsible for repairs and upkeep of the chancel.

Can Non-Parishioners Be Liable for Chancel Repair?

Even if you’re not a parishioner, you can still be liable as long as you’re the land or property owner.

Liability is joint and several, meaning you can be responsible for the total cost of repairs to the local church as a landowner.

The liability is still enforceable unless it has been expressly abolished by statute or substituted for an annual payment. The church can claim the full payment from one or any number of liable property owners.

Homeowners facing such a claim are also legally entitled to claim contributions from other liable property owners in the parish.

Who Can Enforce Chancel Repair Liability?

Before 1932, the liability was only enforceable through the ecclesiastical courts.

Today, the jurisdiction of ecclesiastical courts is in civil cases concerning church buildings and cases where clergymen are accused of ecclesiastical crimes.

The Chancel Repairs Act 1932 abolished the jurisdiction of ecclesiastical courts to enforce the repair of chancels.

The legislation passed the responsibility to the county court and named the authority responsible for enforcing the liability as the parochial church council of the parish church.

Related reading: 

• Reasons for remortgaging.
• Remortgaging to release equity.
• Remortgaging to buy another property.
• Remortgaging with bad credit.
• Remortgaging for home improvements.
• I own my house outright can I remortgage? 
• Capital raising mortgages.

How Did Chancel Repair Liability Change in 2013?

Some people think the chancel repair liability was abolished in 2013, but it wasn’t.

The chancel repair liability only ceased to be an overriding interest, meaning it’s no longer automatically enforceable against property owners and their successors in title.

For the liability to continue to affect a property, it must be registered at the Land Registry and stated on the title as a potential liability to homeowners.

The new status doesn’t abolish the liability because the church can still protect its right to enforce chancel repair liability by registering a notice at the Land Registry against affected properties. Once it is registered, the right is protected forever.

In addition, the right to register a notice still exists after 13 October 2013 against properties with no change in ownership since that date.

Even if a notice has not been registered at the Land Registry, the chancel repair liability still binds the property owner after 13 October 2013 until the property is sold ‘for value’ to a new owner (when the liability falls away).

The term ‘for value’ means that property transfers by way of gift, inheritance, divorce settlement, or at undervalue may not qualify for exemption.

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When Should You Order a Chancel Repair Search?

You should order a chancel repair search when you appoint a conveyancing solicitor. The solicitor can commission one of two chancel searches:

• A Chancel Check Search – This search reveals whether the property is located within a parish that could charge for repairs to the chancel. However, it doesn’t show whether or not the actual subject property is located on land with this responsibility. This type of search can show you whether there is a certain level of risk.

• A Full Chancel Search – This search is much more expensive but will reveal whether the actual subject property is liable. The solicitor must register this liability with the Land Registry if it is.

What Can You Do to Protect Yourself?

If a potential liability exists on the property, it’s highly recommended that you take out chancel liability insurance from a reputable insurer.

Although the premiums vary, you can expect to pay a one-off premium of around £25 or more depending on the circumstances for a standard residential property.

It will cover you against claims for up to 25 years after you’ve purchased the property.

Some policies last for however long you own the property, while others can last forever, even if the property changes hands.

Generally, the cost of the policy required for the property will depend on the level of cover required, the amount of land involved (from less than 1 acre to 10 acres), and whether the policy is for 25 years, 35 years, or in perpetuity.

Final Thoughts

A chancel repair search is an affordable way to determine whether the property you’re buying in England or Wales is liable for chancel repairs.

It can provide you with peace of mind against unexpected large bills and help you take appropriate action like insurance to protect you from legal and financial issues.

Call us today on 03330906030 or contact us to speak to one of our friendly advisors.

Sources and References

https://www.legislation.gov.uk/ukpga/Geo5/22-23/20/section/1

Most lenders can allow you to pay off someone else’s mortgage. You don’t need to be related to the homeowner to pay off their mortgage or make a mortgage payment.

You can pay someone else’s mortgage to help them out when they’re in a tight spot or simply because you’re in a giving spirit.

You can even do it anonymously with the correct information.

But what happens when you pay off someone else’s mortgage, and are there any implications? Read on to find out.

Can You Pay Off Someone Else’s Mortgage?

Yes. Lenders will not prevent you from paying off someone else’s mortgage.

However, they’ll ask you a few questions before they accept the funds for repayment for due diligence reasons.

These can include questions like why you’re doing it, the relationship between you and the mortgage owner, where the money comes from, and how you accumulated it.

The lender is responsible for determining why the transaction is happening to satisfy anti-money laundering guidelines and checks.

They must establish the source of any funds, especially significant funds, that they receive into the customer account from third parties who aren’t adding their name to the mortgage.

What Do You Need to Provide to Pay Off Someone Else’s Mortgage?

The lender can request a copy of your recent bank statements before finalising the repayment and closing the mortgage account. The bank statements can help clarify the source of the funds.

They’ll also ask for your passport or driving license to verify your identity and a written statement from you as the payer outlining the circumstances of why you’re making the payment.

Most times, it can be a signed letter outlining the following:

• Your name
• Your relationship with the homeowner
• The value of the payment
• Confirmation that the payment isn’t a loan and the payee doesn’t need to repay it.
• Confirmation that you don’t have any interest in the property

Sometimes, lenders can refuse to accept the payment or complete the transaction.

For example, if there appears to be a strenuous link between you and the payee or if they suspect any fraudulent activity.

However, most lenders will comply with your request provided there’s clear evidence of where the money is coming from and a valid relationship between you and the mortgage owner.

Related reading: 

• Reasons for remortgaging.
• Remortgaging to release equity.
• Remortgaging to buy another property.
• Remortgaging with bad credit.
• Remortgaging for home improvements.
• I own my house outright can I remortgage? 
• Capital raising mortgages.

Are There Any Tax Liabilities When You Pay Off Someone Else’s Mortgage?

Yes. Although it’s very generous to pay off someone else’s mortgage, the recipient could face some inheritance tax (IHT) implications in the future.

In the UK, the HMRC allows each person an annual gift allowance of £3,000 for IHT purposes.

You can give any number of people this amount annually, and it won’t count toward the value of your estate when you die.

However, any money gifted above this amount is considered a potentially exempt transfer (PET).

A PET is tax-free only if you live for seven years after giving the money.

The recipient may have to pay inheritance on some of the money if you die sooner, depending on when you die.

How Much Tax Will Be Due on A Potentially Exempt Transfer (PET)?

Inheritance tax is charged at 40% on the total value of your estate and above the nil-rate band allowance.

The Inheritance Tax Act currently sets the nil-rate band at £325,000.

For any amount considered a PET, the tax charge decreases by 20% each year on a sliding scale during the seven years.

Here’s how much inheritance tax might be due on PETs:

Years Between Gift and Death	Tax Rate on PET
0-3 years	40% charge
3-4 years	32%
4-5 years	24%
5-6 years	16%
6-7 years	8%
0-3 years	40% charge

There will be no tax liability if the value of your estate is below £325,000 when you die.

Ensure you speak with a professional and experienced mortgage broker or tax advisor before paying off someone else’s mortgage.

They can ensure the process goes smoothly and correctly and help you understand the tax implications.

For example, let’s assume you had agreed to pay off your son or daughter’s mortgage as a gift or to assist them during a period of financial difficulty.

If the outstanding balance owed is £200,000, the amount, once paid, would be classed as a PET for IHT purposes.

If you died within four years, and your total estate – including the PET – was higher than the nil rate band, your child would have a 24% IHT tax liability to pay for this gift (£200,000 x 24% = £48,000).

How Can I Minimise Inheritance Tax when Paying Off Someone Else’s Mortgage?

When paying off someone else’s mortgage, you can use various strategies to minimise the potential inheritance tax. These include:

• Using other gift allowances – If you’re a parent or grandparent, you can use other gift allowances that will not affect inheritance tax. These include giving up to £2,500 for a grandchild’s wedding or up to £5,000 for a child’s wedding.
• Using a trust – You can also set up a trust to manage mortgage payments and reduce the impact of inheritance tax. Trusts are legal agreements that allow you to transfer assets to a separate legal entity, which a trustee manages for the benefit of the trust’s beneficiaries.
• Making regular payments – Consider making regular contributions towards the mortgage instead of a lump sum if you can afford it. Such payments can be exempt as they’re considered part of normal expenditure.

How Can You Pay Off Someone Else’s Mortgage Anonymously?

You can pay off someone else’s mortgage anonymously if you have the right information.

You only need to find the mortgage company and account number through public records and make the payment.

To stay anonymous, you can make the payment using a money order mailed with no return address.

The name of a mortgage holder’s lender and the mortgage holder’s account number are generally publicly available.

Final Thoughts

Paying off someone else’s mortgage is a very generous gesture, but it can have tax implications you need to be aware of.

Ensure you consult an experienced tax advisor who can explain the potential tax implications for you and the recipient.

Sources and References

https://www.gov.uk/government/publications/inheritance-tax-nil-rate-band-and-residence-nil-rate-band-thresholds-from-6-april-2026/inheritance-tax-nil-rate-band-and-residence-nil-rate-band-thresholds-from-6-april-2026-to-5-april-2028

The market value determines the cost of property in the UK. The market value is the estimated amount a property should exchange for between a willing buyer and a willing seller after valuation.

Although it can seem odd, you can find some properties selling under the estimated market value, and it’s a common and accepted practice.

If you’re looking for a mortgage for a house you’re buying below market value, there are various things to consider about how it will impact your mortgage application.

Here’s everything you need to know about how to get a mortgage for a house you’re buying below market value.

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Can You Get a Mortgage for A House You’re Buying Below Market Value?

Yes. You can get a mortgage to buy a house below market value if you meet the lender’s eligibility and affordability criteria.

However, getting a mortgage for properties below market value can differ from a regular mortgage.

The circumstances of the sale can make the most significant difference among lenders.

The lender may be suspicious that the low price is a sign of collusion or fraud between the seller and buyer.

You can expect more scrutiny in the valuation and mortgage application, especially if you’re not buying from a family member or estate agent.

Why Would a House Be Sold Below Market Value?

You may get a house selling at below-market rates for various legitimate reasons. These include:

• Buying a house from a family member – For example, parents with a property portfolio can help their children become property owners by selling the house at a cheaper price.
• A deliberately undervalued house – Sellers can undervalue a property to secure a quick sale, especially if they’ve encountered cashflow problems and need fast cash. Selling the property may provide the funds they need for a larger project to continue.
• Financial difficulties – Financial distress can be a solid motivator for lowering the price of a property. The seller may reduce the price to attract prospective buyers and avoid issues like bankruptcy or imminent repossession. They may also be relocating in a hurry and need to raise quick cash.
• Auction sales – Properties in auctions sometimes sell below market value. Auctions usually include properties where quick cash sales are needed. Lenders may sell repossessed property and want to achieve a figure covering the outstanding cost only. Sellers can also knock down the property’s price to match the highest bidder of the day, which can be below the market value.

What Are the Eligibility Criteria for A Mortgage for A House Below Market Value?

You may find some rules around the eligibility criteria among some lenders when looking for a mortgage for such properties. These include:

Seller Restrictions

The lender can have rules you must follow about the person selling the property. For example, they may require that the seller doesn’t reside on the property after the sale completion.

They may also need to perform checks and seek professional advice if the seller is above 75 years as an extra precaution.

Loan-to-Value (LTV)

Most lenders will have rules around the maximum LTV ratio they’re willing to offer when buying a house below market value.

The LTV ratio is the mortgage size the lender can provide relative to the total value of the property you’re buying, expressed as a percentage.

Lenders usually offer a maximum LTV range between 70-95% of the sale price or valuation.

Deposit

Lenders will require a minimum deposit amount and may require you not to get the deposit as a gift. Higher mortgage deposits generally allow you to qualify for more mortgage deals and better rates.

Your choices will improve as your deposit gets larger, while low deposits will limit you to a few lenders, and they’ll likely have more stringent criteria you need to meet.

Your Relationship with the Seller

The lender may want to determine what kind of relationship you have with the seller and may have their definition of what they consider a relative.

The lender may be suspicious if the price looks too cheap and may want to determine whether you’re colluding with the seller or planning a fraud.

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Solicitor Approval

Some lenders will require confirmation or approval from a solicitor guaranteeing that everything is above board before they can consider offering you a mortgage for a house you’re buying below market value.

What Are the Tax Considerations When Buying a House Below Market Value?

There can be specific tax considerations depending on the circumstances in which you’re buying a house under market value. These include:

Stamp Duty

Stamp duty is a property tax you pay in the UK when you purchase a piece of land or property.

The amount you pay depends on the purpose and value of the property you want to buy and the type of buyer you are.

When buying a property sold below market value, the level of the stamp duty will depend on the purchase price instead of the market value.

Capital Gains Tax (CGT)

The Capital Gains Tax is the tax you pay on a portion of the profit or the capital gain you get from selling land or property that isn’t your primary residence.

The CGT is calculated using the property’s market value instead of its sale price, and it only applies when selling secondary properties and not the property you live in.

The CGT level will depend on the circumstances of the person selling the property and the tax bracket.

Inheritance Tax (IHT)

There may be some inheritance tax liability if you buy the house from a parent. The discount between the sales price and market value can be considered a lifetime gift, and the beneficiary may need to pay a 40% IHT if the giver dies within three years of providing the lifetime gift. However, if they die after seven years, the IHT liability is 0%.

Final Thoughts

If you’re looking for a mortgage for a house you’re buying below market value, it’s worth getting some expert guidance and advice from an independent broker experienced in arranging such mortgages.

A mortgage advisor can present the options to you, prepare your application for the best possible outcome, and assist you every step of the way.

Call us today on 03330 90 60 30 or contact us to speak to one of our friendly advisors.

Lenders consider various factors before deciding whether to approve your application when applying for a mortgage in the U.K.

One of the most critical factors is your income since it determines whether you can afford the repayments on the mortgage you’re applying for.

An accountant certificate helps prove your income to a mortgage lender and shows that a qualified professional has prepared your accounts, especially if you’re self-employed.

Here’s everything you need to know about an accountant certificate for mortgage applications.

What Is An Accountant Certificate?

An accountant certificate is an important document prepared by a certified accountant. It provides evidence of your income and expenses to prove you can make regular mortgage payments.

An accountant certificate provides written confirmation from a qualified and independent entity.

It shows the amount of income you’ve stated you earn on your application is correct for getting the mortgage borrowing you need.

The accountant certificate proves to the lender that you have a good financial standing and that your income and expenses are up-to-date and accurate.

It also includes information about your assets and liabilities, tax returns, and debts.

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Why Do You Need an Accountant’s Certificate for a Mortgage Application?

When applying for a mortgage, you’re asking the lender to provide you with the funds you need to purchase a property.

The lender must assess your eligibility for the loan based on various factors. To complete a mortgage application, you must provide a range of personal and financial information, including details about your income, financial commitments, and employment history.

The accountant’s certificate assures mortgage lenders that you’re reliable and can comfortably afford the monthly payments throughout the mortgage term.

Mortgage lenders usually require a comprehensive view of your finances, especially if you’re self-employed.

They may want to see stability, consistency, or profitability, and a qualified accountant can help present your situation professionally and accurately.

An accountant with the proper credentials can handle your unique financial situation with expertise and translate your financial information into terms that mortgage lenders can trust and understand.

Which Accountant Can Certify Accounts for A Mortgage Application?

Only accountants with recognised qualifications can vouch for your creditworthiness for a mortgage application. The lender will want to see that a qualified accountant prepared your accounts.

An accountant must be a member of a recognised professional body to be eligible to certify accounts for a mortgage application.

Most mortgage lenders accept Chartered and Certified Accountants certificates as industry standard.

Other recognised credentials include Association of Authorised Public Accountants, Association of Accounting Technicians, Association of International Accountants, Association of Taxation Technicians, and Institute of Financial Accountants.

The table below shows the qualifications and bodies accepted by most mortgage lenders:

Accountancy Body	Institute	Qualifications Accepted
Institute of Chartered Accountants in England & Wales	I.C.A.E.W	A.C.AF.C.A
Institute of Chartered Accountants of Scotland	I.C.A.S	C.A
Institute of Ireland Chartered Accountants, also known as Chartered Accountants Ireland	I.C.A.I	C.A
Chartered Certified Accountants Association or the Association of Authorised Public Accountants	A.A.P.A or its subsidiary A.C.C.A	A.C.C.A
Chartered Institute of Management Accountants	C.I.M.A	A.C.M.AF.C.M.A
Certified Public Accountants Association	CPAuk	A.C.P.AF.C.P.A
Association of Accounting Technicians	A.A.T	M.A.A.TF.M.A.A.T
Chartered Institute of Taxation	C.I.O.T	C.T.A (Fellow)F.T.I.I (Fellow)C.T.A A.T.I.I
Chartered Institute of Public Finance & Accountancy	C.I.P.F.A	C.P.F.A
Institute of Financial Accountants	I.F.A	A.F.A (Associate) F.F.A (Fellow)

 

How Can I Get An Accountant Certificate for A Mortgage Application?

You can obtain an accountant certificate for a mortgage application through the following steps:

Step 1 – Find An Accountant

If you don’t already have an accountant, the first step is to find a qualified accountant who can provide the service.

You may need to research to find one who can help since not all accountants offer this service.

Your friends and family can offer recommendations, or you can search online for accountants in your area.

Ensure you check the accountant’s experience and qualifications before hiring them and confirm their registration with a professional body.

Step 2 – Provide Your Financial Information

Once you find an accountant who can provide an accountant certificate, you’ll need to provide them with details of your financial information, including your expenses, income, and any liabilities and assets.

The accountant will use this information to prepare the certificate confirming your income and other financial details the mortgage lender needs.

The accountant is also qualified to offer advice or guidance on managing your finances to improve your chances of getting approved for a mortgage.

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Step 3 – Confirm The Lenders Requirements

It’s essential to check the requirements of the lender you’re applying to before you apply for a mortgage. Some lenders can have specific requirements for the content and format of the certificate.

You should ensure the certificate provided by the accountant meets such requirements to make the process easier and smoother.

You can also give the lender additional documentation like tax returns or bank statements to support your application.

Step 4 – Pay For The Accountants Services

Getting the accountant certificate is a professional service, so you should expect to pay for the accountant’s expertise and time.

The certificate’s cost can vary depending on the complexity of your financial situation and the amount of work needed.

Accountants usually charge around £150 to £250 for issuing a certificate.

Ensure you agree on a fee with the accountant before they start working on the certificate and ask for an estimate of the cost in advance.

Once you get the accountant certificate, you can submit it to the lender along with your application.

You should keep a copy of the accountant certificate for your records and ensure all the information you provide is current and accurate.

Final Thoughts

Acquiring an accountant certificate for mortgage applications is an excellent way to support your application and reassure lenders that you can afford mortgage repayments.

The certificate provides evidence of your income and expenses and can present your financial situation accurately and professionally.

You can get an accountant certificate and increase your chances of approval by finding an experienced and qualified accountant, providing accurate information, and confirming the lender’s requirements.

Call us today on 03330 90 60 30 or contact us to speak to one of our friendly advisors.

Product transfer mortgages have become more popular in recent years. Reports by UK Finance show that in 2023, 88% of homeowners preferred product transfers over external remortgaging due to affordability constraints.

A product transfer is an easy and cost-effective way to get a new deal on your mortgage.

A mortgage is one of the most expensive investments, and accessing the most competitive deals can help you stay on top of your finances.

A product transfer is usually quick to complete and can help you save money and avoid the complications of remortgaging.

Here’s everything you need to know about product transfers to help you determine whether it’s a smart move.

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What Is a Product Transfer Mortgage?

A product transfer mortgage involves changing your current mortgage deal with the current lender instead of remortgaging with a different lender.

If your current deal is about to end and your lender has advertised a new rate or deal with a cashback incentive or lower fees, you may want to consider transferring your mortgage.

A product transfer can help you avoid rolling onto the lender’s standard variable rate, which is usually higher.

You can also ask the lender what other deals they have and switch to them to avoid paying higher on the standard variable rate.

How Does a Product Transfer Mortgage Work?

Product transfers are usually quick and straightforward to complete if the amount borrowed remains unchanged and you’re not revising the mortgage terms.

Some homeowners can switch their deal in a few days if the mortgage term and loan amount don’t change.

You can switch to a better agreement quickly because most product transfer mortgages don’t have any complexities.

Unlike external remortgages, such agreements don’t involve measures like eligibility assessments or house valuations, helping save a lot of time and avoid legal red tape.

The lender will also not conduct a credit check since you’re not changing the terms of the mortgage agreement. This can be beneficial if your circumstances have changed from when you initially took out the mortgage.

What Are the Pros and Cons of a Product Transfer Mortgage?

Weighing the pros and cons of product transfer mortgages can help you determine whether it’s the best option for you.

Pros of Product Transfers

• Highly Competitive Rates – You can access better rates with a product transfer mortgage, as some lenders reserve the best deals for their existing customers.
• Fewer Fees than A Remortgage – With a product transfer, you can avoid legal fees since you don’t need the services of a solicitor. You also don’t need to worry about valuation fees or exit fees, which are common in remortgages.
• No Affordability Checks – If you’re not borrowing more money or changing the terms of the mortgage, the lender will likely not perform any affordability checks. It can be helpful if you’re struggling to be accepted elsewhere and will not leave a mark on your credit report.
• Less Paperwork – A product transfer features less red tape and can be relatively straightforward, provided you’re not changing the mortgage terms or borrowing more money.
• Quick and Easy Applications – You can easily do a product transfer online or over the phone, and acceptance can take a few hours or days. Alternatively, you can use a mortgage broker to arrange the deal.

Cons of Product Transfers

• The Best Rates Aren’t Guaranteed – You shouldn’t simply take up your current lender’s offer without checking for better deals elsewhere. Your lender doesn’t have to offer you the best deal simply because you’re an existing customer, and you can find better rates with rival lenders.
• Limited Choices – You may not find a deal that meets your needs or requirements since your lender can have a limited number of product transfer deals to choose from.
• Can’t Borrow More – You’ll not be able to borrow more money or change the term of the deal with a standard product transfer. If you’re refinancing with your current lender to borrow more, it will be a different product transfer called a further advance, which involves more eligibility assessments.

How Do You Compare Product Transfer with Remortgage Deals?

You can compare product transfers with remortgage deals through the following steps:

Step 1 – Determine Your Current Lenders Best Deals

Find out the product transfer rates your current lender is offering by asking them about all the deals they’re offering.

Step 2 – Determine What Deals You Can Get from Other Lenders

Finding out what other lenders are offering allows you to evaluate your options and determine which one is better suited to your circumstances.

A mortgage broker can help you search the entire market to determine what’s available.

Some brokers offer access to exclusive deals and can advise you on lenders who are likely to accept your request or the products that have the features you’re looking for.

You’ll be in a better position to determine which option is better for you after determining how deals from other lenders compare to deals from your current lender.

In some situations, a product transfer will make more sense even when you find a better rate with a different lender.

For example, if you don’t want to go through the entire remortgaging process, including affordability checks and paperwork, a product transfer with slightly worse rates can still be suitable.

What Fees Will I Pay with A Product Transfer Mortgage?

Although product transfers don’t feature as many fees as remortgages, you’ll likely still pay an arrangement fee. Most lenders allow you to choose how to pay the fee.

You can pay it upfront if you have the cash and avoid paying any interest on the fee. You can also add it to your mortgage balance.

However, this will increase your monthly repayment slightly since you’ll be paying off the fee plus interest.

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Final Thoughts

Product transfer mortgages can offer various benefits and help streamline the refinancing process. However, it also features a few drawbacks you must consider before deciding.

Whether or not a product transfer is the best option for you will depend on your circumstances and personal situation. Ensure you shop around and use a mortgage broker to get access to numerous deals available in the market.

Call us today on 03330 90 60 30 or contact us to speak to one of our friendly advisors.

According to a 2023 article in The Independent, in 2015, most mortgages in the UK were in just one name.

Nowadays, in 2023, the statistics show us that two-thirds of first-time buyer mortgages are in joint names.

How things have changed! But just as things have changed to push people into applying for joint mortgages, things can change again, giving homeowners viable reasons to want to get out of the shared contract.

Split-ups, divorce, and going separate ways happen for married couples, long-term partnerships, siblings, and friends.

The most important thing is knowing how you’ll remove someone from a shared mortgage when that happens and what it will cost you!

Top reasons for wanting to remove someone from a UK mortgage include:

• Separating or getting divorced
• Removing an investor
• Buyout

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How to Remove Someone from a Joint Mortgage UK

Removing someone from a UK mortgage is a two-part process.

The Legal Part

The legal part of removing someone from a joint mortgage in the UK can be simple if everyone agrees.

If all parties agree, you must hire a professional conveyancing solicitor to ensure all the legal aspects of the process are correctly managed.

Once you’ve got a conveyancing solicitor in your employ, there isn’t much for you to do except provide them with the paperwork and information they request.

At the start of the process, you’ll receive paperwork from the solicitor, which you must complete and return to them.

The cost is usually between £100 and £200, which is the average cost of remortgage processing.

That’s easy. 

But there are times when it’s not easy. Sometimes, one party wants to be removed from a joint mortgage, and the other party doesn’t agree.

Or one party wants another to be removed, and they refuse. That’s when things can become a little tricky. If all parties don’t agree, you could face time-consuming complications.

If you cannot come to a compromise with the other party, such as settling on a buyout amount or specific terms, you could go the route of legal challenge.

If you’re trying to save on costs and hassles, it’s safe to say that you’ll find this route stressful, time-consuming, and expensive.

Most people choose the legal route as a last resort if all parties seriously cannot agree.

The Mortgage Process Part

Removing a person’s name from a joint UK mortgage is similar to remortgaging.

Before you start the process, take the time to scrutinise your existing mortgage to determine if it’s still the best deal for you.

Sometimes, there are better deals with other lenders, and switching makes financial sense. 

Of course, if switching is going to add fees that push the cost of your overall mortgage higher than your existing one, you will want to avoid that.

Because removing someone’s name from a mortgage requires a new mortgage application, it makes sense to shop around for potential deals that might outshine your existing one.

The requirements to remove a name from the mortgage and keep it under one name throw the remaining party into the spotlight.

The lender must assess your ability to afford the mortgage independently, which can be tricky for some people. 

What Lenders Want to Know When You Apply

• What your credit score is
• What your income is (affordability)

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Supporting Documents to Accompany Your Application

When removing someone from a joint UK mortgage, you’ll need to provide documents that prove you’re eligible for a new mortgage with just your name on it.

You will need to provide the following documents to support your application:

• 3 months of bank statements
• 3 months of payslips
• Proof of address (utility bills)
• Latest P60 tax form
• Proof of ID (driver’s license or passport)

If you are self-employed, you may need to provide financial documents for 6 months instead of just 3.

You can prove your income with a letter from your accountant or your latest tax returns. 

Once the lender receives your application and supporting documents, they will review your application.

If you are switching lenders, the new lender may require you to re-evaluate the property, and a new credit check will be run.

Must I Buy Someone Out to Remove Them from Our Joint Mortgage?

The short answer is no. You don’t have to buy someone out to remove them from the mortgage.

If the other party agrees to bow out and the lender agrees that you can afford the mortgage alone, you can remove the person from the mortgage without a buyout.

In this case, you will process a “transfer of equity” involving your chosen solicitor handling the paperwork.

You can expect it to take approximately 30 days to complete, but some lenders take a little longer to finalise processing.

The amount of equity each party has in the property is determined by the type of joint mortgage you have.

For instance, a “joint tenants” mortgage means that both parties have equal equity in the property.

A “tenants in common” mortgage doesn’t imply a 50/50 ownership but rather an agreement in place that stipulates each party’s share in the property.

This means one may have more equity than the other, possibly due to a higher deposit amount or higher portion paid towards the monthly mortgage instalments. 

In both instances, you will apply for a new mortgage as a sole owner or add someone new in a joint application. 

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A Word of Warning

Removing someone’s name from a mortgage in the UK comes with financial implications.

The remaining party will be liable for the mortgage, which may significantly increase their monthly financial responsibilities.

Before deciding to remove someone from a mortgage, it’s a good idea to do some budgeting and see if it’s the right course of action for you. 

Using a Mortgage Advisor

To ensure that you don’t put yourself in a poor financial position and to ensure that the mortgage lender you approach is most likely to assist you, it’s recommended to use a professional mortgage advisor or broker.

A mortgage advisor can present the options to you, prepare your application for the best possible outcome, and assist you every step of the way. 

Call us today on 03330 90 60 30 or contact us to speak to one of our friendly advisors.

There’s no need to bang the drums or sound the horns for this one – it’s not really a surprise!

According to Statista, a 2022 survey found that around 70% of people in the UK used a broker when buying property.

And 91% of them rated it as a good experience. It’s not surprising when you consider that mortgage brokers can get better rates than the average person.

If that comes as a surprise to you, it’s time you find out more.

Life, as we know it, is fraught with choices, even when deciding how to find the best price and funding for a new home.

When you apply for a mortgage, you’ll either use a mortgage broker or try doing all the legwork yourself by going directly to the bank.

Before deciding which approach is right for you, you’ll need to understand how using a mortgage broker can save you time, money, and frustration.

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Which is Better, Going Straight to the Bank or Using a Mortgage Broker?

A mortgage broker is a blessing for those who want to access a broad selection of products without approaching each mortgage provider.

Mortgage brokers have access to the entire market, and they’ll know just what to do if you’re working with a tricky application, such as having bad credit or being self-employed.

Using a mortgage broker is usually recommended if you’re the average Brit looking for a good deal and the least hassle and complexities. 

Now, on the other hand, if you’re a financial expert or have gone through the mortgage application process so many times that you could do it in your sleep, then approaching the bank, lender, or building society yourself is possibly worth your time. 

Navigating the course of a UK mortgage application alone can be challenging and stressful, but with a mortgage broker on your side, you can benefit in several ways.

Some of these ways include:

• Mortgage brokers don’t just focus on one product. They have access to a wide range of products, which allows for comparison and real consideration.
• Your credit report can be efficiently optimised and your application correctly prepared with the help of a mortgage broker.
• A mortgage broker will have a broad overview of your financial situation and in-depth knowledge of your requirements, helping them to shop for the best deal and negotiate better rates for you.
• You won’t find yourself scrambling for an unexpected document during the application process because your mortgage broker will furnish you with a comprehensive checklist of required documents prior to starting the process.
• You’ll get access to a range of affordable insurance options to accompany your mortgage deal.
• If you have an unusual situation or your application isn’t considered a “run of the mill,” a mortgage broker can provide specialist advice and guide you through every step. High risk, bad credit, and self-employed applicants can get assistance finding the right product for them with help from a mortgage provider.
• Mortgage brokers can help you avoid tarnishing your credit record by applying for credit with the wrong mortgage providers and being rejected. The idea is to find the right lender for you as quickly as possible.

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Overview: Pros and Cons of Applying for a UK Mortgage with the Bank Directly

There are, of course, some pros to going directly to the bank for your mortgage application:

• In some instances, it can be quicker to finalise the process but there’s still the risk of higher interest rates as you’ll have no one to negotiate for you.
• There are no broker fees.

Some cons of a mortgage application UK directly via the bank:

• The bank won’t present a selection of products for you to compare and choose from. Instead, you will only have their set of products.
• You’ll be presented with limited products and expected to make the decision yourself, unaided by someone with background knowledge of your financial situation. 

Overview: Pros and Cons of Applying for a Mortgage with a Mortgage Broker UK

With a mortgage broker, you can expect some pros and cons too. The pros are:

• You’ll get access to the entire market.
• The advice from a mortgage broker UK is unbiased as none of the products are “in-house.”
• You’ll likely get helped by a highly qualified and experienced advisor who can provide you with specialist advice and guidance. 

Some cons of using a mortgage broker:

• Buyers pay mortgage brokers fees, but these are usually minimal, and the trade-off is that you’ll most likely save quite a bit on interest.
• Sometimes it takes a little longer to get the right deal set in place because you’ll review multiple products on the market to find the right one for you.

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Do UK Mortgage Brokers Get Better Rates for Their Clients?

In most instances, professional mortgage brokers can arrange lower interest rates for their clients than if those same clients approached the mortgage provider themselves.

This isn’t because the lender is trying to pull the wool over your eyes but because a mortgage broker will access options from multiple lenders to compare instead of approaching just one or two lenders and getting access to a few limited products.

By considering your circumstances and financials, a mortgage broker can present you with all the deals you qualify for, and you’ll most likely discover more affordable options with professional help. 

What Are Broker-Exclusive Deals?

What a mortgage provider in the UK offers you when you apply for a mortgage and what your mortgage advisor may be able to negotiate for you could be worlds apart.

Some lenders will go as far as only dealing with brokers, meaning you cannot access their products directly but will need to go through a broker.

These are broker-exclusive deals usually made up of discounted and specialist offers.

Broker-exclusive deals and the help of a specialist mortgage broker are certainly ideal for borrowers who are considered high-risk.

Common high-risk borrowers who can benefit from broker-exclusive deals include:

• Self-employed or non-formally employed individuals
• Low income earners
• Expatriates
• Retired individuals

A mortgage broker can ensure that you present your application in the right way and have all the correct paperwork to prove affordability and apply for the amount you’re most likely to qualify for.

Using a mortgage broker in these scenarios could be the difference between getting the funding you need or being turned away or saddled with an exorbitant interest rate.

Are Mortgage Brokers Expensive?

One of the top concerns for home buyers is that they’re spending too much when purchasing property. Mortgage broker fees are at the top of the list when buyers want to cut back on costs.

But here’s the deal: mortgage broker fees aren’t always expensive.

Some charge a fee, but this may be negligible when you consider how much a mortgage broker can save you in the overall cost of your mortgage.

You’re most likely to find a better deal with a broker, and the overall savings will make the cost of the mortgage broker seem irrelevant. 

Going directly to the bank may seem like you’re saving money in the short term, but when you add the interest and the fact that you may be missing out on a better deal with another provider that the bank will never tell you about, do you stand to benefit?

Start a Relationship with Your UK Mortgage Broker Today

Mortgages in the UK last a lifetime. You can expect to pay off your property for some 20 to 30 years.

That’s a large chunk of your time, and you undoubtedly want to know that you’re getting yourself into a good deal now, as it’s a commitment you won’t easily get out of.

By teaming up with a UK mortgage broker, you can rest assured that you’re selecting from the best mortgage deals you qualify for and have someone on your side, fighting to get you the best financing possible for your money!

Call us today on 03330 90 60 30 or contact us to speak to one of our friendly advisors.

A large number of homeowners in the UK would prefer to renovate a home rather than move from it.

One in 10 respondents said the cost of buying and selling was off-putting, even though they may wish to sell their property.

This alone shows us that the desire for renovation is there – and a mortgage can make it possible. 

For those with creative flair or those who can see the potential of a property that’s up for sale, renovation mortgages are often the aim.

New builds with perfect finishes and modern charm aren’t everyone’s cup of tea, and if you’re more the type who likes to personalise a home to reflect your own style while capitalising on designs of the past, buying a property to renovate may seem exciting.

Other scenarios where renovation mortgages make sense are:

• When you’re already in a home but want to make alterations (remortgage)
• You’re an investor who wants to flip a property

But…how do you go about getting a mortgage that covers the cost of the property purchase and renovations?

What is a Renovation Mortgage and How Does it Work in the UK?

In short, a renovation mortgage provides funding to purchase a property that needs to be renovated.

The property can be bought on the open market or at an auction.

These mortgages are usually very useful when purchasing property that lenders won’t finance.

Think of a derelict house that needs extensive repairs or properties without electricity or running water.

Most lenders and High Street banks view such properties as “unmortgageable.”

Enter the spotlight, renovation mortgages.

Renovation mortgages are granted based on the loan size and the property’s anticipated value after renovations are completed.

This can result in a higher mortgage than a mortgage based on a property’s current value.

Unfortunately, mortgage lenders aren’t always overly keen to provide renovation mortgages in the UK, and this comes down to the risk.

For instance, a buyer may start renovations and run into delays or find that certain processes and renovations are more expensive than initially calculated.

This could mean delays, which results in a slower return, or it could mean that the renovations can’t be completed at all. In such instances, the mortgage provider stands to lose.

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Costs That Renovation Mortgages Cover

UK renovation mortgages are intended to cover the following: 

• The cost of the property
• Repairs 
• Remodelling and renovations

What Credit Score is Required for Renovation Mortgages in the UK?

It goes without saying that the better your credit score is, the more chance you have of getting approved for a renovation mortgage.

A good credit score tells the lender that you’re responsible with your bills, pay your debts, and are less of a risk.

hat said, it doesn’t mean all lenders will reject you outright. Sometimes, specialist lenders provide funding to borrowers with poor credit scores.

There’s a catch, though. Mortgages for bad credit borrowers usually come with higher fees and are typically provided in smaller, easy-to-manage amounts. 

If you want to improve your credit score, you can:

• Regularly access your credit report to ensure that the information is correct.
• Make payments on time.
• Contest notes of missed payments etc, that are incorrect.

Are Regular Mortgages Available for Fixer-Uppers?

No law or rule stipulates that you cannot use a regular mortgage to purchase, repair, and renovate a property.

In fact, if the property is habitable, then this can be an option. If you’re on a budget or are a first-time buyer, this may seem the best route.

In such instances, the buyer will intend to carry out the repairs and renovations themselves instead of hiring professionals to handle them. 

This option is often opted for because affordability shows that only a limited amount can be borrowed.

Some buyers and investors may even opt for a regular mortgage now and then, later on, take out an additional loan to cover repairs and renovations.

How Much Deposit is Required for UK Renovation Mortgages?

All mortgages in the UK require the buyer to provide a deposit. Some buyers save up for years to get to around 15% of the amount they need to purchase a home.

Renovation mortgages typically require deposits between 15% and 20% of the total amount needed. 

The deposit can come from your personal savings, the sale of an asset (property, car, etc), or a gift from a family member. 

Mortgage providers consider an individual’s financial circumstances when deciding whether to approve or deny a mortgage request.

Your unique circumstances may even make you eligible for a lower deposit.

The best thing to do is to check your eligibility before you make a formal application. 

When a mortgage application is declined, it could show up on your credit profile, causing other lenders to wonder what got you declined. 

Can People with Debt Still Get Renovation Mortgages in the UK?

Bad credit may get you instant denial from some lenders, but several others in the UK offer mortgages and other loans to people with debt.

The lender will likely assess your finances to determine your debt-to-income ratio. This is the amount of debt you have compared to your income.

The process aims to determine if your current debt is affordable and if adding any additional debt to the situation will strain your budget and cash flow. 

A mortgage advisor or broker can help you with calculating your debt to income ratio so that you know what a mortgage provider will be looking at. 

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Getting Renovation Mortgages for Properties You Already Own

If you own a home and want to carry out renovations, remortgaging the property is recommended.

Remortgaging for renovations may carry limitations on the funding amount, and how much you qualify for may depend on:

• How much the property’s value will increase once renovations are complete.
• How much is left to pay on the mortgage
• Your current income and credit score

Remortgaging for renovations may have terms ranging from 5 to 40 years, with more interest expected the longer the term.

Also, you must go through an affordability assessment, as each mortgage, even remortgaging, requires a new credit check.

If your financial situation has worsened, you may not get a good interest rate or could be denied the loan.

Consult with a Mortgage Broker

By consulting with a mortgage broker about the ins and outs of renovation mortgages, you can get a better idea if you’ll qualify and which lenders in the UK are the best approach. 

Call us today on 03330 90 60 30 or contact us to speak to one of our friendly advisors.