Mortgage Light’s experts shared their tips in our first virtual mortgage clinic
Last week, we held our first, live online mortgage clinic to bust some myths around mortgages, specifically for those of you buying your first home. Our biggest takeaway? The pandemic (and the economic uncertainties it has created) doesn’t seem to be deterring first-time buyers in Milton Keynes.
Our virtual guests had plenty of questions covering a range of practical topics – we’ve rounded up a few of the helpful, and perhaps surprising, conclusions from our discussions.
You can apply for a mortgage if you’re on furlough
If you are on furlough, a number of lenders will still consider a mortgage application from you. The same applies if your usual working hours have decreased temporarily. Lenders will be looking for a letter from an employer confirming your circumstances and return date.
You can take out a loan to pay a deposit on a home
This surprised many of our attendees! However, while it is possible to take out a loan to pay a deposit, remember that all of your debts – included this loan! – will be considered by your lender when you apply for your mortgage, to assess your affordability.
If you are self-employed, you don’t always need three years’ of accounts on record
Different lenders have different criteria, and some won’t insist on the standard three years’ worth of accounts to consider a mortgage application. If you are employed by another company or individual but have only just joined the company – or if you are soon to start a new job but you are currently unemployed – you don’t necessarily need six months’ worth of payslips either if you can prove your income in other ways, such as with a signed offer letter.
Haggling when you make an offer doesn’t often make much difference to your monthly payments
If you have your heart set on your dream home but promised yourself you wouldn’t go a penny over a certain number, remember that one or two thousand pounds won’t really impact your monthly payments over the long term. However, be mindful that if you are putting in an offer based on the maximum amount that your lender will grant you, any additional costs on your budget will need to come from your own savings, income or with help from family.
A mortgage isn’t for life!
While you might have a mortgage for a long period, it’s worth remembering that it certainly doesn’t need to be – and often shouldn’t be – the first mortgage you bought. As your lifestyle and finances change, so can your mortgage deal – revisit it each time your fixed-rate period (usually two or five years) reaches an end to make sure it is always working for you…and consider a remortgage if it isn’t.
If you’d like to have a friendly chat with the Mortgage Light team about your options for getting onto the ladder, get in touch on 01908 597655 or via our contacts page. We hope you can join us for our next virtual mortgage clinic – stay tuned for more information!