If you’re living with a disability or a long-term illness and have applied for a mortgage and been turned down, you may wonder if your health situation is to blame.

While many may think that’s the case, the problem often comes from the lack of affordability – which can happen to anyone, not just disabled or ill individuals.

In most instances, the inability to pass an affordability assessment comes from the borrower being on benefits or a small income, which lenders see as risky.

Even with a disability, you must meet the lender’s requirements before you are deemed a viable candidate for a UK mortgage.

If you are wondering if you can get a mortgage in the UK if you’re disabled or suffering a long-term illness, wonder no more. Wonder no more! We bring the answers directly to you!

Below, we cover the legalities involved in getting a mortgage if you’re disabled and on benefits. Believe it or not, there are lenders more than willing to assist!

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The Equality Act 2010 Says All UK Mortgage Applicants Must Be Treated Fairly

The Equality Act 2010 states that lenders must treat applicants fairly.

What does this mean? It means that you cannot be rejected or required to meet stricter criteria (more interest to pay or higher deposit requirements) based on your disability or health status when applying for a mortgage in the UK.

Mortgage lenders in the UK must strictly base their outcomes on the applicant’s credit score and the loan’s affordability.

This means that unless your disability or illness impacts your ability to pay for the loan, you cannot be rejected based on illness and disability!

The Act states that anyone with “a physical or mental condition that has a substantial and long-term impact on your ability to do normal day-to-day activities” will be protected by the Act.

Mortgages for Disabled People in the UK

If you have a long-term illness or disability, you may be living on benefits, and it’s this little fact often impacts the outcome of a disabled or ill person’s mortgage application in the UK.

However, because benefits are considered unreliable income, you may find it challenging to qualify for a UK mortgage application.

But that doesn’t mean that all applicants on benefits will be turned away.

In fact, if you’re on disability benefits and you’re also employed, this could be a good thing for your mortgage application.

This means that your benefits are seen as a boost to your existing income.

In scenarios where your benefits are larger than your salary/income, you may find it a little more challenging to qualify.

All of this said, even if your entire income is benefits based, there are still lenders willing to help you get the funding you require for your mortgage.

UK Disability and Illness Benefits Most Likely to Be Accepted by UK Lenders

Lenders are only concerned with affordability and, of course, your ability to repay the loan.

This is why certain benefits are accepted over and above others, as they are considered more stable.

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Also, you can only use a benefit as proof of sufficient income if the main applicant is the claimant of the disability benefit.

The following benefits are most often accepted by mortgage providers in the UK:

• Disability Living Allowance – DLA
• Adult Disability Benefit
• Personal Independence Payments (PIP)

You must provide proof of your benefits income when applying for a mortgage.

But what if you’re not on a disability benefit but receive other benefits?

Can they be used as proof of sufficient income?

Some benefits that aren’t disability-related can be used, and these usually include the following:

• Maternity Pay
• Widows Pension
• Child Benefit
• Child Tax Credit
• Universal Credit
• Working Tax Credit
• Job Seekers Allowance
• Attendance Allowance
• Carers Allowance

Of course, getting benefits and an income doesn’t automatically mean that you will qualify for a mortgage.

Mortgage lenders will consider your full income (salary + benefits) and compare this to your current and ongoing expenses.

If you have a small amount of money available at the end of the month, and it appears you won’t comfortably afford the loan repayments, the application will most-likely be rejected – not because of your disability or long-term illness but merely on the basis of ill-affordability.

Schemes That Help Disabled Applicants Get UK Mortgages

In some instances, getting a disability UK mortgage can prove challenging.

If this is the case, you can use one of the several schemes available that help disabled applicants get into the property market.

One such scheme is the MySafeHome scheme which offers shared-ownership options.

You can use this scheme if you’re on PIP (Personal Independence Payment), DSA (Disability Living Allowance), Universal Credit, Pension Credit, or ESA.

Another scheme is the HOLD scheme, which also offers shared-ownership options.

To be eligible for this scheme, you must prove that you can’t buy a suitable home that caters to your disability or illness.

You must also be a first-time property investor and earn no more than £80,000.

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Making the Process Easier for Applicants of Disability Mortgages in the UK

If you’re at a loss for where to start or just need a bit of guidance to make the mortgage application process easier for you, it’s best to chat with an experienced mortgage broker who has knowledge of the industry and working experience helping disabled people or those with a long-term illness to get the funding they need to buy a home.

Call us today on 03330 90 60 30 or contact us. One of our advisors can talk through all of your options with you.

With summer coming up, more Brits are considering their options for a second home mortgage, and you guessed it; a holiday home!

One of the first things that come to mind, after the financial factor, is where to buy a holiday home.

There are plenty of options spread across the UK – how do you make the ideal choice?

For most people, choosing a holiday home comes down to several factors as follows:

• Location, location, location!
• Climate
• Cost of property (affordability)
• Crime rate
• The people

Not sure where to start? Don’t worry! We did the legwork for you!

Check out our top pick of the best places to buy a holiday home in the UK.

Where to Buy the Best Holiday Homes in South West England

New Forest District

New Forest isn’t just gorgeous but enjoys around 217 hours of sunshine per month, which is much more than most places.

It is no surprise that it’s a tourist hotspot, with the national park’s beautiful trees towering over the area.

This area is exceptional for families and couples, with many opportunities for walking, camping, and canoeing.

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And to top it all off, there’s something for thrill-seekers, too: a theme park!

Water quality is excellent, and you can expect the average temperature to be around 16 degrees Celsius.

While New Forest is not the cheapest area to invest in, it is considered one of the best. Check out Brockenhurst and Lymington.

Torridge

Spanning the north coast of Devon, Torridge is a firm favourite for locals and holidaymakers.

You’ll find gems of South West England, such as Westward Ho and the Hartland Devon Heritage Coast, in the area.

Torridge enjoys 186 hours of sunshine per month and has an average temperature of 16 degrees Celsius.

Beaches, a theme park and an outdoor activity centre, provide all the entertainment one could want while on holiday!

Where to Buy the Best Holiday Homes in South East England

Hastings

As it turns out, Hastings is one of the best places to buy holiday property in all of England!

It’s vastly popular among holidaymakers and offers swimming, beaches, walks and a plethora of amenities to enjoy.

Hastings enjoys 222 hours of sunshine per month and an average temperature of 17 degrees Celsius.

Canterbury

Canterbury is an area that steals the hearts of many Brits looking for prime holiday homes that provide a wealth of natural beauty and entertainment opportunities.

It also helps that Canterbury hosts not just one but three UNESCO world heritage sites.

These include the ruins of St Augustine’s Abbey, the Church of St Martin, and the Canterbury Cathedral.

Canterbury also enjoys a whopping 235 hours of sunshine per month, an average temperature of 17 degrees Celsius and various walks and historical sites for entertainment.

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Where to Buy the Best Holiday Homes in the East Midlands and Yorkshire

East Lindsey District

East Lindsey can be found nestled in the coastal district of Lincolnshire.

The area enjoys 193 hours of sunshine each month and an exceptionally low crime rate.

There’s plenty to do and see when holidaying in East Lindsey District, with the most popular attractions including Skegness Beach and Natureland Seal Sanctuary.

Tea rooms, sports bars, pubs, and restaurants also delight visitors.

City of Nottingham

For those who like to holiday in bustling communities that are active and busy, the City of Nottingham is a top pick!

The city is jam-packed with restaurants, bars, shopping malls, sports stadiums, and even night clubs.

With a lively atmosphere and so much to see and do – even open-water swimming – it’s one of the most popular areas to own holiday property.

For sun lovers, the City of Nottingham enjoys 184 hours of sunshine per month.

Where to Buy the Best Holiday Homes in the East Anglia

East Suffolk District

East Suffolk District stands out for holidaymakers who like to swim at some of the best beaches.

As one of the best places to buy a holiday home in East Anglia, East Suffolk offers plenty to do and see.

You can enjoy beach escapes and walks and enjoy the area’s various shops, restaurants, and pubs.

The average temperature in East Suffolk is around 17 degrees Celsius, and the area gets around 222 hours of sunshine per month.

Great Yarmouth District

Another best place to buy a holiday home in East Anglia is Great Yarmouth.

The seafront of Great Yarmouth is known as the “Golden Mile” and those with holiday property in the area can enjoy beautiful sandy beaches, outdoor and indoor attractions and even amusement arcades.

Great Yarmouth District enjoys a very low crime rate, around 227 hours of sunshine per month, and average temperatures of 17 degrees Celsius.

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How to Buy a Holiday Home in the UK

If you already have a mortgage to pay off your primary home in the UK, you might wonder how it’s possible to buy a second property.

If you’re specifically buying a second property to serve as a holiday home that you will personally use yourself, you will need to apply for a mortgage called a second home mortgage.

This is for property that you don’t plan to rent out to other people.

If you wish to buy a holiday home in England so that you can hire it out to holidaymakers, you will need to apply for a buy-to-let mortgage.

It’s vitally important that your finances are in good order if you’re going to apply for a second home mortgage.

Best Place to Buy a Holiday Home in the UK Conclusion

Spend some time considering which type of mortgage would be best for you, based on your intended purpose for the property.

After that, you should consult with a mortgage expert who can advise you on the requirements for the type of loan you’re looking for.

Applying for a second home mortgage to get a holiday home can be simplified with the help and guidance of a professional.

Keep in mind that second home mortgages often require a 15% deposit.

Call us today on 03330 90 60 30 or contact us. One of our advisors can talk through all of your options with you.

In this guide, we will talk about student mortgages UK and the frequently asked questions surrounding them.

Many British students’ default thinking process is that they won’t be able to get a mortgage simply because they’re a student. And we’re here to challenge that thinking.

The reality is that students can get onto the property ladder if they want to, and this post covers how to do that.

First off, don’t blame yourself too harshly if you’ve thought negatively about mortgages in the past while.

It’s not entirely outrageous to believe that lenders (especially mortgage lenders) that are typically risk-averse may consider students (regardless of age) a “no-go.”

After all, it’s normal for students to have limited income and a credit history that could be more robust.

This all said, lenders are making it possible for student mortgages UK.

Below we look at pertinent information for student mortgages in the UK.

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Can Students Get Mortgages in the UK?

The great resounding answer to this question is; yes! UK student mortgages exist, but you’ll have to use alternative avenues to the average full-time employed citizen seeking a mortgage.

For starters, having a co-signatory or collateral will simplify the process.

But, of course, even with collateral or a co-signatory, you’ll still need to prove you’re in good financial standing and that you will be responsible once the UK student mortgage is extended.

The good news is that mortgage lenders in the UK consider each application individually, taking into account unique circumstances for each.

One of the best steps you can take is to consult with and even be represented by an experienced mortgage broker who has specific knowledge of how student mortgages UK work.

Proof of Income UK Students Can Use When Applying for Mortgages

As you may well know, how much you earn is an important part of any mortgage application.

Keep in mind that not all income streams are considered viable, and the type of income accepted will often come down to which UK student mortgage lender you use.

Many UK lenders will accept bursaries and stipends as a viable income source.

Before a lender commits, they will take a look at several factors as follows:

• How big is the deposit you’re putting down?
• Do you have a co-signatory?
• What collateral do you have to offer?
• Do you have a stable secondary income source?
• How long does your grant or stipend last?
• Are you already dealing with existing debt?
• Are you working, and if so, how much are you generating each month?
• What are your current monthly expenses?

If you’re receiving an allowance, trust payout, or generating income, make sure you mention this and provide evidence.

The more you earn or receive (and can prove), the better it is for your application.

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Can Any and All Students Get UK Student Mortgages?

Of course, lending in the mortgage industry is non-discriminatory in the UK.

While certain student types may have greater access to income streams or be considered more responsible, lenders must look at the overall income amount, affordability and value of your collateral, or financial standing of your co-signatory (guarantor).

This means that the course you are studying doesn’t come into play and won’t impact the outcome of your UK student mortgage application.

One niggling point to keep is if you’re a foreign national seeking property in the UK as a student.

In theory, you can apply for a UK student mortgage regardless of where you live.

Still, if you use a guarantor (co-signatory) to secure the UK mortgage, the guarantor must own property in the UK to qualify.

3 Steps to Apply for Student Mortgages UK

To apply for a mortgage in the UK as a student, follow these simple steps:

Step 1:  Check Your Credit Score

Your credit history report will indicate how viable you are as a mortgage applicant.

You don’t have to pay for a credit check; you can check your credit score for free using the Experian website here.

Step 2: Consult with a Mortgage Broker

Chatting with a mortgage broker with specific experience with student mortgages in the UK is a step in the right direction.

They can guide you towards the right type of mortgage and ensure that you have everything required for the best possible potential application outcome.

Step 3: Compile the Required Documents

A mortgage broker can provide you with a checklist of the documents you will need to present during your application.

Make sure that you have everything required before processing your initial application.

Scrambling for documents last minute may just delay the entire process.

Can Students Get Joint Mortgages in the UK?

It appears that while joint student mortgages UK aren’t the norm, there are no rules or stipulations against them.

When students (or students and their partners) apply for joint mortgages, there’s a standard process to expect.

For example, the main income earner’s salary/income will be considered to determine affordability.

In short, to qualify for a joint student mortgage in the UK, the student or the partner earning the higher income must prove that they can afford the loan instalments even without the other applicant.

Types of UK Student Mortgages Available

As a student in the UK, you can consider the following types of loans that are suitable for students:

1.   Buy for University Scheme

In this instance, the parents are usually responsible for the mortgage, but the student’s (child’s) name is officially on the deed.

Students often rent out rooms to make an income to pay instalments. You can’t buy just any property with this mortgage type.

In fact, lenders will require the property you have in mind to meet certain criteria concerning the size of the house, the location, the number of rooms, and how many years you have left to study.

No fixed interest rates are possible, and you can expect the APR to be typically high.

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2.   Family Springboard Mortgage

This UK student mortgage is available to students with family members who can put up 10% of the total property value as collateral.

The amount is put into savings with the lender. The actual buyer will need to provide 5% of the property value.

3.   Guarantor Mortgages

This is a “just in case” mortgage whereby the student applying is responsible for the loan repayments.

Still, a co-signatory will take responsibility if something happens and the student can no longer afford to repay the loan.

The tricky part is that your chosen guarantor will be assessed as if they are applying for the mortgage themselves, and they must already own property in the UK.

4.   Joint Borrower or Sole Proprietor Mortgages

This is the ideal UK student mortgage for a first-time buyer. In this instance, only one applicant holds the actual mortgage, but several people can pay into the mortgage.

Student Mortgages UK Conclusion

Student mortgages are certainly possible in the UK, but you must select the right type of UK student mortgage for your situation and only get into a loan that you’re sure you can afford to repay.

Call us today on 03330 90 60 30 or contact us. One of our advisors can talk through all of your options with you.

Your age can directly affect your eligibility for a mortgage, as lenders set upper and lower age limits for applicants to minimize the risk involved in lending and ensure they get a full return on their investment.

Here’s everything you need to know about mortgage age limits in the UK.

How Does Age Affect Mortgage Eligibility?

The older you get, the riskier you become to mortgage providers, making it harder to get a mortgage.

You’ll likely be on a lower income when older, either due to retirement or not working full time.

Your income will also be lower even with a pension to fall back on.

You’ll also have a greater risk of health issues as your age advances, impairing your ability to survive the full term of a standard 25–30-year mortgage and further inhibiting your eligibility.

To help mitigate such risks, lenders set maximum age limits on their deals.

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What Is the Maximum Age Limit for A Mortgage?

Mortgage lenders usually set their age limits, so there’s no absolute maximum.

Lenders can stipulate a particular age limit at the point of application or when the mortgage term ends.

The lender may require that you’re not over 55 or 60 years when applying for a mortgage and that the mortgage term ends by the time you’re 70 or 75.

Mainstream providers are usually more conservative in their age limits, setting the maximum age at the end of the mortgage at 70 or your retirement age, whichever comes sooner.

Lenders specializing in later-life mortgage products can go up to 80 years and beyond.

Some don’t stipulate any age limits and instead decide whether to lend to older borrowers on a case-by-case basis.

Most lenders acknowledge the increased life expectancies today, and more people are working longer, creating more flexibility and leniency when lending into the retirement age.

What Other Factors Affect Mortgage Eligibility After Retirement?

Securing a mortgage isn’t just about how old you’ll be at the end of the term.

Other stringent conditions that can further impact your eligibility include:

Affordability

Affordability is crucial in all mortgages, regardless of your age. Lenders will only approve your mortgage application if you can prove you can make your repayments on time each month throughout the full term.

If the term runs into your retirement or you’re applying for a mortgage post-retirement, you must provide sufficient evidence that you can continue with repayments.

Lenders determine affordability by comparing your debt to income (DTI) ratio or monthly income vs outgoings and basing their decision on the amount you have left over that can cover mortgage repayments.

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The Loan-to-Value (LTV) Ratio

The LTV is the size of your mortgage compared to the market value of the property you’re buying, expressed as a percentage.

Most lenders set a maximum LTV ratio and offer better deals to applicants with lower LTV.

A large deposit can give you a low LTV and increase your chances of getting favourable rates from more lenders as they consider the mortgage a lower risk.

A low LTV gives the lender more security in case property prices fall.

With a high LTV, the mortgage amount can exceed the property value in case of sudden drops, making it difficult for the lender to recoup their investment if you fail to make repayments.

Most lenders readily approve an 80% LTV for repayment mortgages, meaning you’ll require a 20% deposit.

Others accept 80%, while a select few consider 95% LTV, subject to meeting other criteria.

The maximum LTV is usually 85% for interest-only mortgages, but this can decrease to 75% for older applicants.

Property Type and Credit History

The type of property you want to buy and issues surrounding your credit history can also create obstacles for later-life borrowing.

Attempting to borrow to finance a non-standard property can be difficult because of the risks associated with such properties.

Unusual properties have a limited market, and most lenders consider them a higher risk.

If you default and the lender has to repossess, they’ll find it harder to sell than other properties.

Such unique properties can include houses with timber frames, high-rise flats, listed buildings, new builds, non-standard construction, and uninhabitable property.

Lenders will also consider you a higher risk if you have poor or bad credit.

The main issues involved in eligibility assessments when credit issues are a factor include the type and severity of the credit issue, the date it was registered and the reason for the bad credit.

Mortgage Alternatives for Older Borrowers

Various mortgage alternatives exist for an older borrower, provided you meet the eligibility criteria.

These include:

Lifetime Mortgages

Eligibility for lifetime mortgages starts at age 55 and is a form of equity release.

It’s a mortgage secured against your home, provided it’s your main residence, allowing you to retain ownership.

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You get a tax-free lump sum or smaller multiple pay outs to do with as you please and repay the loan amount and any accrued interest when you move into long-term care or pass away and the property is sold.

You can also choose to set aside some of the property’s value as an inheritance for your family.

Home Reversion

A home reversion plan allows you to sell all or part of your home by releasing equity in exchange for a single lump sum or regular payments.

Lenders allow you to continue living on the property rent-free until you die or move into long-term care, provided you insure and maintain it.

Retirement Interest-Only Mortgage

With RIO mortgages, you only pay interest, similar to standard interest-only mortgages.

The loan amount is then paid off when you sell the property, move into long-term care, or pass away.

RIO mortgages usually feature minimum age requirements starting from 50 years.

Older People Shared Ownership (OPSO)

OPSO is a type of shared ownership for people aged 55 years and older.

It allows you to buy an initial share in an OPSO home, from 10% to 75% of the market value, and then pay rent on the remaining share.

Mortgage Age Limit UK Final Thoughts

Getting a mortgage when you’re older or retired can present some hurdles, and products may be harder to come by, but it’s not impossible.

A mortgage adviser or broker with experience arranging later-life mortgages can increase your chances of success, give you an in-depth view of the market and help you find an appropriate lender for your circumstances.

Call us today on 03330 90 60 30 or contact us. One of our advisors can talk through all of your options with you.

You’re travelling the countryside or walking through the streets of your favourite British village, and your eye rests on a cute sign affixed to a cottage with a rambling rose creeper and a thatched roof: Rose Cottage.

Ahh, there’s something about that cottage already, and it’s not just that it’s in your favourite village or only that it’s pretty.

It’s about more; it’s been named, and the name itself is rather quaint. And therein lies a bit of psychology to think of when buying and selling property in the UK.

You’d probably never guess that giving your property a name might drive up its value and earn it more attention.

Don’t worry – most people don’t know that either.

But property value research has provided a titbit of information that’s garnered much interest in recent times.

What’s that? For starters, homes named “Courtenay House” in the UK are typically far more expensive than other properties and usually go for somewhere in the £4.8m.

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Research has found that homes with that name tend to be more expensive than those with any other.

By now, you’ve probably got a myriad of questions.

Did you pay too much for your property because it came with a name? Can you change the name, and at what cost?

Will you get more for your property than its deemed value because it has a name?

Should you name your property to increase its value? Should you avoid named properties if you’re in the market for a mortgage?

First, let’s deviate a little onto some of the other popular names doing the rounds on the property market in the UK.

Other Popular Names for High-Price Properties

While House of Courtenay is the house name that brings in the highest sale price, there are other house names that bring in a pretty packet for those trying to sell them.

And while these names are already being used, perhaps they could inspire some creativity if you’re looking to name your property:

These include:

• Meadow View
• The Willows
• Ivy Cottage
• Hillside
• Orchard Cottage
• Rose Cottage
• Woodlands

Undeniably, these property names have a certain ring to them, but what makes them sell at higher prices than other unnamed properties?

Of course, the value of a property is first and foremost about the quality of the space and the size, but other factors come into play; psychology.

A named property follows a carefully chosen theme, style, era or similar.

This creates a feeling of authenticity, uniqueness, and of course, being elite.

Status is a big deal in the property market – this is certainly food for thought when trying to sell your property or buy one.

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Back to the House of Courtenay, Though

Let’s get back to the nitty gritty about the House of Courtenay.

To buy a property called House of Courtenay, you would typically need about £4.8m – at least that’s what the average property price works out to.

While you catch your breath, here are a few more facts you might want to know about properties named Courtenay in the UK:

• Courtenay properties in the UK that sold for the most were in Hampshire, Exeter, and North London (ranging from £2.9m to £7.7)
• Other high-priced properties that are named include: South Penthouse, Bar House, Ormidale, and Doves House.

Now that you’ve caught your breath, let’s look at where House of Courtenay comes from. Is it a historic name and what makes it so popular (and expensive, for that matter)?

First of all, Courtenay is not a name that originates from Britain. However, according to research, a medieval French dynasty is linked to the name.

Apparently, in the 12th Century, some of the family relocated to the UK, with most Courtenays residing in Devon.

As a result, many B&Bs, hotels, and manor houses have been named after the dynasty.

Let’s Talk About the Reason Why Named Houses Cost More

It costs just £40 to personalise your home address and this small fee could drive up the value of your house by a whopping 40%.

Why spend thousands on expensive renovations, extensions and extravagant garden landscaping to increase the value of your home when you can simply name your home and benefit exponentially?

You’ve probably seen enough homes in the UK named to know that naming homes in the country isn’t a new fad that just hit the market.

In fact, naming houses is a custom that’s happened for centuries in the UK. It was first seen with the upper class as they named their castles, halls, and manor houses.

They were clearly onto something good.

When you give your property a name, you add a personal touch to the space, which can be descriptive, sentimental, or historic.

Naming Your Home to Increase its Value in the UK

If you want to jump on the property naming bandwagon, it’s best to take a bit of time to carefully choose a name.

Before you settle on a name, write to the local council of your area.

The council will be in contact with Royal Mail to ensure that the name you wish to use hasn’t already been taken, especially in your area.

If the name hasn’t been taken, you’ll be informed once it’s accepted. Now, make your home’s signage – which shouldn’t cost you more than £40.

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If You’re Buying…

With this information in mind, you can cut costs by negotiating with owners who have named their properties or entirely avoid purchasing named properties.

Call us today on 03330 90 60 30 or contact us. One of our advisors can talk through all of your options with you.

With house prices rising and renters paying more than homeowners a year, it can be challenging to decide which is better between buying and renting.

Both options have benefits and drawbacks, and your best choice depends on your circumstances and priorities.

Let’s explore both options to ensure you make an informed decision.

Buying Vs Renting in the UK 

Before deciding whether buying or renting is the best option, you need to weigh the pros and cons involved.

Pros of Buying a Home

Homeownership comes with various upsides, including:

• Freedom

Owning your own home means you don’t have to adhere to any tenancy agreement that states what you can and can’t do.

You’ll not need anyone’s permission to keep pets, decorate or furnish your home however you want and even make structural changes to enhance its value.

• Security

You’ll enjoy the security of a home in the long run without worrying about being forced to move by the landlord at short notice.

• Investment

Buying a home is investing in your future, and the monthly repayments will contribute towards something that is yours instead of your landlord’s.

You’ll have an asset that can increase in value, and you can sell it or use the equity to buy a bigger property, downsize to fund a retirement or invest the profit.

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• Control

A fixed-rate mortgage makes it easier to control outgoing costs since you know exactly how much you owe each month.

When renting, you’re on the whim of the landlord, who can decide to increase your rent at any time.

Cons of Buying a Home

A few drawbacks of homeownership include:

• It’s a huge commitment

Buying a home is one of the biggest financial commitments you’ll ever make.

It will likely be your most considerable monthly expenditure for years, and you must be sure you can meet the monthly mortgage payments.

You may not have much left for other expenditures if you overstretch your budget, and if your circumstances change, you may struggle with repayments and even lose your home.

• Property market changes

The property market is volatile, and although the overall trend for properties is increasing in value, prices can also fall.

You might end up in negative equity if the prices fall too much and you find yourself with a property worth less than the mortgage.

• Additional costs

Owning a home comes with additional costs you must consider.

You’ll need to pay for insurance to cover the building and contents and protect your mortgage if something happens to you.

You’ll also be responsible for legal fees, Stamp Duty, Capital Gains Tax and maintenance or repair costs like fixing a leaking roof.

• Less flexible

Moving or selling can be time-consuming and difficult when you own a home, especially if you have a joint mortgage.

When you separate from your partner, taking over the mortgage or selling the property can be costly and complicated.

Legal and estate agency fees and moving costs can also be more prohibitive.

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Pros of Renting

Renting comes with various benefits that can suit your lifestyle, including:

• Flexibility

It’s easier to move quickly when renting, as most rental agreements are only six to 12 months long.

If you lose your job, change jobs or simply want to live in a different area, you’ll not face many barriers.

You can give your landlord notice, walk away, rent a smaller home, or temporarily move in with family or friends as you figure things out.

• Easier budgeting

You’ll only need a small deposit, and rental payments rarely change. You’ll know your rent each month, making it easier to budget.

• You don’t have to worry about property prices or maintenance

You’ll not be affected if property prices or interest rates go up or down.

You’ll also not be responsible for maintenance costs, and if something goes wrong, you can simply call the landlord to fix it.

• More choice

Renting allows you to live in a bigger house and nicer area than you could when buying.

Some desirable locations in the UK are out of reach for most buyers, but you can live in a sought-after area when renting.

Cons of Renting

A few disadvantages of renting include:

• You’re not investing in yourself

Renting involves making large monthly payments to your landlord’s mortgage instead of your own.

You can easily pay rent your whole life instead of becoming a homeowner.

• It’s becoming more expensive to rent

Renting has become more expensive than owning a home in terms of monthly accommodation costs.

According to the Home Let Rental Index, rents are historically high and will continue to rise throughout 2023.

• Rules

You must abide by the landlord’s rules when renting, and there could be restrictions on modifying the property or owning pets.

• Sudden changes

You’ll be at the landlord’s mercy, and they can make sudden changes that disrupt your life.

For example, they can decide to increase the rent and impact your budgeting or suddenly sell the property and force you to find somewhere else to live.

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Considerations When Deciding to Buy or Rent

Your situation will help you decide whether buying or renting is the right option.

A few things to consider include the following:

Do You Have Enough Deposit?

Difficulties saving for a deposit remain one of the biggest barriers to homeownership.

Although 0% deposit or 100% mortgages are available, they often come with various pre-conditions you must meet, including good credit ratings or having a guarantor co-sign the mortgage.

How Long Will You Stay?

If you expect circumstances to change, like moving jobs, renting may be more flexible and cheaper.

When you start paying rent, the deposit is cheaper than the initial cost of owning a home.

Can You Afford Repayments and Upfront Costs?

You must consider whether you earn enough to afford monthly mortgage repayments and the upfront costs of buying a home.

Such costs can include Stamp Duty, survey or valuation fees, solicitor fees, estate agent fees and moving fees.

The costs can vary, and you must weigh whether you can afford them before taking the plunge.

Is Buying Better than Renting UK? Final Thoughts

Buying a home can be a great way to secure your financial future, but renting can also be suitable if you can’t afford a property purchase, want more flexibility, or are not ready to settle down.

An independent advisor can help assess your circumstances and provide bespoke advice on the best way forward.

Call us today on 03330 90 60 30 or contact us. One of our advisors can talk through all of your options with you.

You’ll have various options when taking out a mortgage, including whether to be charged a fixed or variable interest rate on the amount you borrow.

One can be better than the other, depending on your circumstances.

This guide compares variable vs fixed mortgages in the UK to help you determine the right option.

What Is a Fixed-Rate Mortgage?

A fixed-rate mortgage offers a fixed interest rate for a certain period, and you’re guaranteed to pay the same amount every month.

Most fixed-rate mortgages involve two-year and five-year deals but can also last up to 10 years or longer, depending on the lender and the product you choose.

When the fixed-rate period ends, you’ll automatically move to the lender’s standard variable rate (SVR) unless you remortgage to a new deal.

The SVR can involve considerably higher rates than the rate you were paying in the fixed term.

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Benefits of a Fixed Mortgage

The main advantage of fixed mortgages is they give you certainty.

You know how much you’ll pay monthly for a set period since you’ve locked in the rate.

The fixed rate doesn’t change during the agreed period and will not be affected by changes in the bank of England’s base rate.

With rising interest rates and inflation, a fixed-rate mortgage can be more attractive as it guarantees you’ll pay the same monthly without worrying about unexpected changes.

Drawbacks of a Fixed Mortgage

Since the rate you pay doesn’t change, you risk missing out on potential reductions in interest rates and lower repayments.

If rates fall during the fixed term of the deal, you’ll continue paying more than necessary for months or years.

If you want to exit to a cheaper deal during the fixed term, you may have to pay early repayment charges, which can be very expensive.

What Is a Variable Rate Mortgage?

With variable-rate mortgages, the interest rate can change over time.

The rate you pay and the monthly repayments can go up or down, and different lenders can base such changes on different measures.

How and when it changes can depend on the type of variable rate mortgage you choose.

These include:

• Tracker Mortgage Rate – A tracker mortgage tracks the base rate of the Bank of England and always remains at a specified percentage point above the base rate. When the base rate increases, the tracker mortgage rate rises, and when it falls, the tracker rate decreases.
• Standard Variable Rate – The standard variable rate is the lender’s default rate. Each lender works out their SVR differently and is almost always higher than any of their other offers. It’s not tied to the Bank of England base rate, but it can reflect changes in the base rate, and the lender can change it at any time.
• Discounted Variable Rate – With a discounted rate, your interest rate will be at a set percentage below the lender’s SVR for a set period. For example, if the lender’s SVR is 5% and your mortgage runs at a 2% discount, you’ll get an interest rate of 2%. The discounted rate can run for two to five years, and you may pay a penalty if you wish to switch or pay off your mortgage within that time.

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Benefits of Variable Rate Mortgages

A potential advantage of variable-rate mortgages is the rate can go down since the interest rate is not set.

You can pay less for a mortgage than you would with a fixed deal and save money over time.

Variable-rate mortgages are also less likely to have early repayment charges, making it cheaper to switch your deal or pay off your mortgage entirely.

Drawbacks of Variable Rate Mortgages

The main disadvantage of variable rate mortgages is that they can go up at any time, making it more difficult to anticipate what you’ll pay and budget.

They usually involve higher rates than fixed deals, and you could make much higher mortgage repayments.

Most lenders pace certain collars on variable-rate mortgages to ensure the interest rate can’t fall below a certain percentage.

For example, if the collar is 1% and the interest rates fall to 0%, you’ll still pay 1%.

Are Variable Mortgages Better Than Fixed Mortgages?

The type of mortgage best suited for you will depend on your financial situation and how much risk you’re able and willing to take.

If you can’t afford the risk of your mortgage going beyond a certain amount, a fixed mortgage can provide you with more security.

However, if your finances can accommodate a rise in mortgage repayments, a competitive variable-rate mortgage can allow you to take advantage of low initial interest rates while offering the potential for reduced monthly payments if interest rates fall.

Taking current interest rates into account can help you decide whether or not you should fix your mortgage and for how long.

With inflation peaking at the end of 2022, thanks to increases in food and energy prices, the Bank of England base rate will likely go up to try and control the inflation levels.

Therefore, it’s an excellent time to fix your mortgage for two or five years and lock in a lower rate.

The low rate will be guaranteed, and your monthly payments will not change even when interest rates rise.

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How Do Costs of Variable Vs Fixed Mortgages Compare?

Most fixed-rate mortgages feature an upfront fee which can be called an arrangement fee, product fee, or completion fee.

They can range from £500 to £1,999, so you can’t afford to disregard them in your mortgage calculations.

You must also factor in the early repayment charge if you intend to repay early or make overpayments.

Sometimes the fee can make variable-rate deals more attractive since they may not have product fees or early repayment charges.

However, the rate can be much higher, and it can be worth paying the product fee for a fixed-rate deal, especially if you don’t intend on making overpayments.

Variable vs Fixed Mortgages Final Thoughts

Your circumstances and attitude toward risk will ultimately dictate the right type of mortgage for you.

A mortgage advisor or broker with experience in both mortgage types can provide bespoke advice on whether a variable or fixed mortgage is appropriate for your situation.

Call us today on 03330 90 60 30 or contact us. One of our advisors can talk through all of your options with you.

If you’re a young adult or low-income earner with family members or friends willing to help you financially, a joint borrower sole proprietor (JBSP) mortgage can help you get on the property ladder.

If you want to buy a property with the help of other people and retain sole ownership, read on to learn more about joint borrower sole proprietor mortgages in the UK.

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What Is A Joint Borrower Sole Proprietor Mortgage?

A JBSP mortgage allows you to share mortgage repayment responsibilities with one or more sponsors or additional borrowers, usually parents or close family members.

It enables multiple people to buy a property together, but only one person maintains ownership.

You can maximise your buying potential with a JBSP mortgage by using all parties’ combined income while maintaining 100% home ownership.

The other parties are not named on the title deed and have no legal claim over the property or any increase in its value.

JBSP mortgages allow people to help someone they care about buy a home or get a bigger and better property.

They’re suitable for young people who would otherwise need to save for many years to buy a house and can also be useful in helping elderly parents secure a mortgage with support from their children.

How Does A Joint Borrower Sole Proprietor Mortgage Work?

Although only one person owns the property, everyone on the mortgage is responsible for keeping up with repayments.

Some aspects of JBSP mortgages are similar to standard mortgages.

All borrowers are assessed, and their income and expenses are considered to determine affordability.

You can incorporate up to four applicants on a JBSP mortgage for a single property.

The more closely you all fit the lender’s eligibility criteria, the more generous they’ll be on their offer.

Such criteria can include income, creditworthiness and age limits like applicants not being over 70 or 80 at the end of the term.

While some lenders don’t have restrictions on who you can get a JBSP mortgage with, most require helpers to be family members.

This ensures you trust each other and have each other’s back since a JBSP mortgage involves joint liability.

If one of you can’t repay, the others are liable for covering the whole amount.

Therefore, ensure you only apply for a JBSP mortgage with someone you trust and who has excellent financial standing.

How Does A JBSP Mortgage Differ From A Joint Mortgage?

The critical difference is that, unlike joint mortgages, not all applicants on a JBSP mortgage will have ownership rights.

With joint mortgages, the applicants who get the mortgage own it together, and if the property is sold, the equity gets split between everyone.

With joint borrower sole proprietor mortgages, the other parties accept responsibility for repayments but have no legal claim to the property.

Only one person is listed on the title deed, meaning the people helping you with the mortgage will not get any money if you sell the property.

They can also avoid stamp duty surcharges on second properties.

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How Does A JBSP Mortgage Differ From A Guarantor Mortgage?

JBSP and guarantor mortgages allow family members and parents to help someone get on the property ladder without legally owning the property.

However, unlike joint borrower sole proprietor mortgages, where all applicants agree to contribute to mortgage repayments from the beginning, guarantors only become liable when you cannot keep up with repayments.

With guarantor mortgages, your family member or parent is only there as a plan B to convince the lender if you have shortcomings like credit issues or a small deposit and give them peace of mind in case anything goes wrong.

Advantages and Disadvantages of Joint Borrower Sole Proprietor Mortgages

Advantages

• Access To Better Deals

With help from other applicants, you’ll have a higher income and deposit, allowing you to access better and cheaper deals than you otherwise would.

You also have access to a better choice of properties.

• Independence

Since you’ll be the sole owner of the property, you can do what you want without asking for permission from co-applicants.

As your salary or income increases, the other parties can gradually reduce their repayments and allow you to take full responsibility for the mortgage.

• Additional Borrowers Can Avoid Stamp Duty

Additional 3% stamp duty surcharges are usually levied on second properties.

However, since the family member or parent helping you with the mortgage doesn’t have ownership rights on the property, they won’t have to pay any stamp duty or capital gains tax.

• Get a Mortgage With a Bad or No Credit History

If you have low credit scores or are yet to build up enough credit history, applying with others can be an excellent option to get approved quickly.

You can convince lenders by teaming up with someone with a good credit history and years of experience repaying loans on time.

Disadvantages

• All Applicants Face Credit Risks

All applicants will be affected equally by defaults, penalties incurred or missed payments.

Since everyone is jointly and severally liable, all your credit histories will be affected if no one makes the monthly repayment.

• Lack of Ownership

Being responsible for repayments but not having any rights or equity on the property isn’t an attractive offer for everyone, especially if the owner makes irresponsible decisions about the property.

Money can easily cause arguments and put a strain on relationships.

• Age Limits

JBSP mortgage deals come with age limits on when the loan should be repaid, making it challenging to qualify if potential sponsors or parents fall outside the accepted age range.

Even if you choose a shorter term to accommodate advanced ages, it will likely come with higher repayments.

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How Much Can You Borrow With A JBSP Mortgage?

Similar to standard mortgages, lenders allow you to borrow up to 4.5 times your income with JBSP mortgages.

However, you’ll be able to combine your incomes and borrow more.

For example, if you earn £15,000, you can only borrow £67,500 (£15,000 x 4.5) alone.

Assuming you and the co-applicants earn £30,000 combined, you can borrow £135,000 with a JBSP mortgage.

Joint Borrower Sole Proprietor Mortgage Final Thoughts

Joint borrower sole proprietor mortgages are niche products not offered by most lenders.

Consulting a qualified mortgage adviser can ensure you get access to direct lenders offering JBSP mortgages, bespoke guidance suitable for your situation and help in the application process.

Call us today on 03330 90 60 30 or contact us. One of our advisors can talk through all of your options with you.

If you want to reduce your monthly mortgage repayments and have a solid repayment strategy to pay off the mortgage later down the line, moving from a capital repayment to an interest-only mortgage can be the right move.

This guide explores everything you need to know about switching to an interest-only mortgage in the UK.

What Is An Interest Only Mortgage?

With an interest-only mortgage, you only repay the interest on your mortgage every month throughout the term.

Your monthly repayments will be significantly lower than repaying capital and interest together, and it’s an excellent way to keep costs low throughout the mortgage duration.

However, you’ll owe the full amount you borrowed at the end of the mortgage term.

You’ll need an effective repayment strategy or plan to repay the lender the original capital as a lump sum, and the lender will need to agree with it as part of the application process.

Most lenders allow various repayment strategies, ranging from reselling the property to savings and investments.

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Can You Switch To An Interest Only Mortgage?

Yes. Most lenders will let you switch to an interest-only mortgage if you’re on a repayment or capital and interest mortgage, provided you can meet their criteria.

Things that lenders will consider when making their decision include:

Your Repayment Strategy

The repayment strategy is a plan you’ll need to cover the final balance you’ll owe the lender at the end of the mortgage term.

You’re responsible for having this plan in place when taking out an interest-only mortgage, and the lender must approve it.

You must also maintain the repayment strategy throughout the loan term, ensuring you remain on track to repay what you borrow.

The best repayment strategy will depend on your situation and your lender, with options including a remortgage, selling the property, investments that generate cash, or saving each month.

Each lender will have different criteria, but you’ll need to show proof that your plans are realistic.

Some lenders may not accept certain repayment strategies and may not allow you to switch.

Equity

Lenders will carefully consider your equity or how much of the property you own outright.

Generally, interest-only mortgages tend to have a lower loan-to-value (LTV) rate than repayment mortgages.

The LTV expresses the percentage you own vs the percentage you still owe the lender as a percentage.

You must have enough equity to meet the lender’s minimum equity requirements.

If your LTV is high, you may have to wait until your equity increases or the property’s value increases before switching to an interest-only mortgage.

Income and Credit History

Most lenders have high-income requirements for interest-only mortgages, and you may need to be earning at least £75,000 for them to allow you to switch.

However, some lenders don’t have any minimum income requirements.

Like other mortgages, lenders will also scrutinise your credit history when deciding whether you can switch.

Interest-only mortgages are riskier for lenders since they must wait for many years before you repay the actual loan.

They’ll consider your credit history more carefully to determine how you handle money and whether you repay your debts on time.

Is Switching To An Interest Only Mortgage Right for Me?

An interest-only mortgage may not be suitable for most people because you need a reliable repayment strategy to make it work.

Here are a few benefits and drawbacks of switching to consider when making your decision:

Benefits

• Low Monthly Repayments

You’ll only make low monthly repayments since you’re only paying off the interest instead of the loan itself.

It’s one of the biggest advantages of switching and can be beneficial if you’re struggling with monthly repayments.

• Temporary Switch

Some lenders allow temporary switches to interest-only repayments, making things easier in periods of financial difficulty. It can lower your monthly repayments for a short period, usually 1 to 2 years.

• Flexibility

You’ll have the flexibility to choose what to do with your money with an interest-only mortgage instead of tying it up in the property.

You can invest what you’re saving monthly and make profits, especially if the interest rates are low.

Drawbacks

• High Risk

Even with a well-planned repayment strategy, there’s always the risk of not ending up with the money you need to clear the loan at the end of the mortgage term.

You’ll need a huge sum to repay the loan in a lump sum, and things can get tricky if your repayment plan performs poorly or falls through.

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• Negative Equity

In case the value of your property drops, you’ll end up repaying a bigger loan than what your property is worth, which is referred to as negative equity.

You’ll have a greater risk of negative equity with an interest-only mortgage than with a repayment mortgage because you’re not reducing the value of your debt, only the interest.

• You’ll Repay More Overall

Although an interest-only mortgage is an excellent way to keep costs low, you’ll pay more overall interest than a repayment mortgage.

Mortgage interest is charged on the total amount you owe, and since the amount you owe doesn’t reduce, the interest you pay over the full term will not change either.

Interest Only Mortgage Alternatives

If you’re struggling to afford a capital repayment mortgage or you want to save money on immediate monthly outgoings, there are other options to consider before switching or if you don’t qualify for switching.

These include:

Mortgage Holidays

Also called a payment deferral or freeze, a mortgage holiday allows you to take a break from your monthly repayments for some time.

It can also involve reducing your monthly repayments, usually for a short period, like three months.

Part and Part Mortgage

This type of mortgage involves paying part of the mortgage on an interest-only basis and part of it on a repayment basis.

However, you may still pay more interest, and although the amount due at the end of the term can be lower, you’ll still need a repayment strategy to cover it.

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Switching To An Interest Only Mortgage Final Thoughts

If you’re considering switching to an interest-only mortgage, consult a mortgage adviser before taking the plunge.

They can offer tailored advice that suits your unique situation, help you with the application process and provide alternative solutions if you don’t qualify.

Call us today on 03330 90 60 30 or contact us. One of our advisors can talk through all of your options with you.

Your employment or job role and income are essential considerations of any mortgage application, and changing jobs after mortgage approval can complicate things.

The lender will need to reassess their view on lending to you, and depending on how your affordability has been affected, you may continue with the agreement, or the provider may withdraw it.

Here’s everything you need to know about changing jobs after mortgage approval.

Why Does Changing Jobs After Mortgage Approval Matter?

Changing jobs can mean your situation differs from when the lender assessed you and approved you for a mortgage.

Lenders want to be sure you can still afford to make mortgage repayments on time, which can be affected by changes to your stability and income.

Changing jobs can make you a risky borrower in a few ways, including:

Your Income Can Change

Your income is factored into your affordability, and if your new job has a different salary or income, you may not be able to afford repayments.

You may have previously proved your income to get approved, but that may no longer be true.

A decrease in income can invalidate the lender’s calculations and take you back to square one.

However, if your income remains the same or increases, you may convince the lender to continue with the mortgage.

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You’ll Likely Be On Probation

Your new job will likely include a probation period, and an employer can abruptly let you go.

The less time you’ve been in a position, the less likely lenders will view you as a stable borrower.

Lenders assess probation periods on a case-by-case basis, and your job security can determine whether or not you get a favourable outcome.

For example, if you’re a specialist in your industry, the lender will likely view the job as secure even if you just started because it can be challenging to replace your skillset.

However, if you’re in low-skilled or unskilled work, your job security can be questionable since your role can be easy to fill if you fail the probation period.

You Face A Higher Redundancy Risk

Thousands of workers are made redundant every year, and although it’s uncommon, it can crop up from time in different industries.

If your employer is forced to make redundancies and you just started a new role, you’ll be most at risk as the newer employees are usually the first to go.

The longer the probation period, the higher your risk, and lenders may not view you favourably since there’s a more extended timeframe where you can be let go.

Should I Inform The Lender When Changing Jobs After Mortgage Approval?

Yes. You have a duty of disclosure from the moment you apply for a mortgage up to mortgage completion when the house sale goes through and you get the keys.

This means you have a legal obligation to inform your mortgage lender of all changes that can impact your application or affordability.

Some lenders can even perform random checks to ensure nothing can affect their decision, so they’ll likely find out about your job change and will probably not consider it favourably if you were hiding it.

It’s recommended to inform your lender when changing jobs after a mortgage approval, especially if the change means you may face financial difficulties that make it challenging to repay the mortgage on time.

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Are Some Job Changes After Mortgage Approval Unacceptable?

Yes. Although affordability is the most important factor, some job changes can make it riskier for the lender to loan you.

For example, if you change from employment to self-employment after a mortgage approval, the lender can withdraw the approval as it’s considered a higher risk.

If the job change makes it difficult for the lender to understand your income or involves variable income, it can be tricky for the lender.

The nature of your income and how you earn your money can be primary concerns since lenders need to discern a baseline and conduct an affordability assessment.

Most lenders will only consider self-employed income if you’ve worked for 12 months and filed tax returns which can give an idea of your income.

If your new job relies heavily on commission, lenders will consider this as less stable, even if you’re making a higher income than a fixed salary.

If your new salary includes bonuses contingent on meeting in-job requirements, lenders may not consider them in the affordability assessment.

If the new job is on a fixed-term contract basis, the lender may not view you favourably since your job will end after a certain period and you can be let go without notice.

What To Do When Changing Jobs After Mortgage Approval

Start by compiling as much documentation for your new job as possible to provide evidence and inform the lender of the job change.

This includes copies of your offer of employment, salary amount, contract and other documentation around remuneration or bonuses.

If you have a similar or better job, you’ll likely be able to continue with the mortgage since you should be able to afford the monthly mortgage repayments.

Even if your income or salary decreases but you can prove comfortable affordability, your approval will not get affected.

The mortgage offer will only be withdrawn if the job change puts you in a drastically different situation. You may not get that particular mortgage, but you can likely qualify for another mortgage.

However, this involves starting the process again and waiting around three months to pass the probation period and accumulate enough payslips to prove your income is stable.

When changing jobs after mortgage approval, the outcome will largely depend on your circumstances, and the lender will consider all the information you present before making a final decision.

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Changing Jobs After Mortgage Approval Final Thoughts

Changing jobs after mortgage approval can be risky for you and the lender and require a reassessment of whether or not you can continue with the initial agreement.

Don’t forget to consult your mortgage broker or advisor and inform them of the changes.

They can give you practical solutions to any problems your job change can cause and even find products that fit your changes if necessary.

Call us today on 03330 90 60 30 or contact us. One of our advisors can talk through all of your options with you.