Your Most Common Mortgage Questions!
With help from Matthew Hines, Senior Mortgage & Protection Advisor from Mortgage Advice Bureau.
Our team have received lots of questions recently from clients asking for further information their own mortgage, a future mortgage or remortgage that they are planning for in the coming months. After reviewing and replying to all of the questions that we have received, it became apparent that several of these questions were the same and this got us thinking…
How many people are out there that have questions on their mortgage but don't know who to ask?
We've teamed up with Matthew Hines from Mortgage Advice Bureau to help answer the most common questions out there.
Q. I’m in the process of buying a house and my lender has valued the house and provided a mortgage offer, can they change the loan?
A: It has always been the case that if you have a material change in your circumstances between receiving your mortgage offer and moving into the house, then you should tell your lender so that they can check the loan is still affordable. The coronavirus is no different, if you have had a change in your income or employment structure, you should speak to the person that arranged your mortgage to see if this needs to be reported to the lender. It's unlikely, but not impossible, that the lender will alter your loan after it has been offered.
Q. Will my mortgage offer automatically be extended by my lender?
A: In a nutshell, no. Whilst the banks will not automatically extend your mortgage offer, many are working on adding the ability to request a 3-month extension if your purchase is delayed due to the coronavirus. You should ask your Bank, Mortgage Advisor or Solicitor to request this on your behalf. Most banks won't consider extending the offer until two weeks before it is due to expire.
Q. If I offered on a house today, can I still apply for a mortgage and obtain a mortgage offer from the lender?
A: Yes you can, most lenders have changed their lending criteria over the last few weeks however it hasn't stopped us from obtaining mortgage offers for clients. Some lenders have restricted policies on visiting the property to provide the bank with a valuation. In some instances, the bank will provide a desktop valuation to save visiting the property.
Q. Is it still possible to remortgage & is it a good time to do so?
A: Most lenders are still offering competitive remortgage products and rates so now could be a perfect time to take advantage of this. The Bank of England base rate was lowered in March to 0.1% and we are starting to see a decrease in interest rates because of this. Everyone's circumstances are different so it's a hard question to give a blanket answer to. If you are worried about your current mortgage, get in contact and we can give you some honest advice on moving forward.
Q. I've been Furloughed, can I still get a mortgage?
A: Potentially – many lenders have adjusted their guidelines and it is always important to ensure that your mortgage is affordable for you. In the first instance, you would need to feel comfortable that the mortgage is affordable for you. If so then some lenders will look at individual cases of clients who have been furloughed. They will then make a judgement call based on your new income and how stable your employment will be long term. I've helped a few clients already secure a mortgage whilst on Furlough so I can definitely try to help.
Q. I am on my bank's standard variable rate – what are my options?
A: Call Me! A bank's standard variable rate can often be a lot higher than other mortgage products on the market. This could be a perfect opportunity to get a new, low-interest rate locked in. Your bank may also offer you a product transfer if you want to stay with your existing lender.
Q. Payment holidays -are they an option to me and what are the pros & cons?
A: Many banks are offering payment holidays to help those suffering with their ability to pay at the moment, most of the time this is without affecting your credit rating. If you are interested in taking one, then you should in the first instance talk to your bank to check that you are eligible. Remember, the interest is still payable and in many cases will be added to your balance. In every instance make sure that you have your banks approval before you miss any payments.
We hope this Q&A has been helpful and may well have answered some of the questions you are currently asking. Matthew is happy to provide free of charge, no-obligation advice to you and is on hand to help with all of your mortgage & insurance needs.
Because we play by the book we want to tell you that…
Your home may be repossessed if you do not keep up the repayments on your mortgage. There may be a fee for mortgage advice. The actual amount you will pay will depend on your circumstances. The fee is upto 1% but a typical fee is 0.3% of the amount borrowed.