This week we answer two questions relating to buying a first home and remortgaging an existing one. If you’d like some advice about any type of mortgage situation or requirement please contact us.
“My partner and I are wanting to buy our first house in the Manchester area. I am 32 and she is 35. We both work full time, my salary is £38,000 and hers is £42,000. We currently rent a flat in Worsley and are looking to stay in the area. We have also considered moving to Urmston / Flixton way as that area seems quite nice too. We are looking to move to a house, rather than a flat, 3 bedrooms and have seen a nice property for £210,000.
We need a mortgage – can you tell us what our options are please? Is there any further information you need?”
Thanks for your enquiry.
First of all, you’ll need to have a deposit of at least 5% ( £ 10,500 based on £ 210,000 purchase price ) – the deposit can come from your own savings or a family gift.
Lenders lend in Loan to Values ( LTV ) with 95% being the highest then reducing by 5% ie, 90% LTV, 85% LTV, 80% and so on – the higher the Loan to Value the higher the interest rate or on the other side of the coin – the lower the Loan to Value the lower the interest rate.
Lenders also lend on affordability – therefore if you have any children, personal loans, car PCP / leases, or outstanding credit card balances these will all have an effect on how much you can borrow.
Your credit history will also be taken into consideration by lenders as they will normally credit check and credit score you – people with good credit histories will be offered high Loan to Value mortgages at competitive rates and if you have a poor credit history you will find lenders will require a larger deposit and charge a higher interest rate.
Manchester Mortgages always undertake a full review of your circumstances – everyone has different requirements and circumstances – then we look to advise and arrangement the best mortgage to suit your needs.
To take matters forward I suggest you ring us on 0161 706 0242 for an informal discussion, or visit our homepage to find out more.
“I am 40 and would like to know if I can remortgage my home? I live in the Timperley area of Altrincham and my home is a 3 bedroom semi-detached. The property is valued at £275,000 and my remaining mortgage is currently £170,000 over 10 years. The house is in need of modernisation and I have been quoted £45,000 for this. So my question is can I get a remortgage and add this £45,000 onto what I owe? Household income is approximately £50k per annum and we are overdrawn at the bank.”
Thanks for your enquiry.
Lenders when re-mortgaging will normally lend up to a maximum of 85% / 90% of your property value – therefore the new mortgage required of £215,000 against the value of the property ( £275,000 ) is approx 78% loan to value and fits within these guidelines.
Please bear in mind that lenders will normally send a valuer to inspect your property and it will be the valuer who agrees the property value – therefore they may or may not agree with your figure of £ 275,000 – if this is the case the lender may or may not lend the full amount you are looking to raise.
Lenders will lend to age 70 so the fact that you are now aged 40 will not be a concern – however, the mortgage term of 10 years may not fit in with the lenders affordability and your mortgage term may have to be extended by a couple of years.
When re-mortgaging the majority of lenders will offer a free standard valuation along with free legal services if you use their nominated solicitor or if free legal services are not offered lenders tend to offer a cash back of around
£ 500 to cover the costs of using your own solicitor to transact the re-mortgage.
At Manchester Mortgages we will research the market place to obtain the best re-mortgage deal for you – but we will also research what your current mortgage provider will offer to ensure you receive the best advice possible.
To take matters forward I suggest you ring us on 0161 706 0242 for an informal discussion.