Our service, experience and professionalism will give you the confidence to purchase your dream home without stress and hassle. Whether you are moving up or down, we will support you every step of the way, from the very beginning until the very end when it’s time to move in.
We can also help you in moving home and keeping your existing lender. You may wish to move but are tied into your current mortgage provider and so would face a financial penalty on leaving before the early repayment charge expiry date. Most mortgages nowadays are portable which means that we can move your current mortgage quite easily to a new property usually without charge.
The Initial Assessment processes :
Firstly, we will determine the likely sale price of your current property as this is key to working out how much you can or should purchase for. As part of our mortgage assessment we will carry out an online valuation of your house to gain an idea of your likely equity and how this affects your borrowing capacity and mortgage deal. You may also wish to speak to an estate agent who has knowledge of the local market and the likely demand for your property, particularly if your property is a little bit quirky, remote, or you have done lots of home improvements/extension works then the advice of a knowledgeable local estate agent is invaluable. The amount of equity in your property is the difference between the value of your house minus any mortgage you have secured on it.
Then we work out the maximum loan size you should be able to obtain which depends upon your borrowing capacity. We appreciate that everyone is individual and so are their finances; some of us may be super scrimpers and save every penny whilst others may enjoy the luxuries in life. For lenders to understand your unique lifestyle so that they can work out the size of loan to give you we will provide them with your income, your likely credit score, your commitments and outgoings, your age and amount of deposit bearing in mind the costs:
Your income:
This is everything that you have coming in whether you are -
- Employed
- Self-employed
- Director or shareholder of a Ltd company
- Contracting
- Full or part-time
- Paid bonus overtime or commission
- We will ask you to provide supporting documentation eg. 3 months payslips, accounts etc.
Your likely credit score :
This is individual to each lender eg. They will award points for certain traits such as bad debts from a certain profile of customer in the past for example someone who has only been self-employed for 18 months. If this is the case they will apply a negative weighting to your score, if this is coupled with something else they deem negative such as having a small deposit and not paying a loan back on time you may not hit the desired threshold of points for them to grant you a loan.
A credit report is a very valuable tool when applying for a mortgage. You can download yours for free at http://www.noddle.co.uk or register with one of the paid services such as credit expert or Equifax. (NB. Lenders never divulge their credit scoring system mainly as it is computer generated so you never know if you will be accepted or rejected until you try).
Your commitments and outgoings such as :
- Loans (car, sofa, or holidays etc.)
- Credit cards
- Nursery costs
- Travel costs
- Maintenance (for an ex-partner or children)
- Number of children (the number of mouths to feed can impact your borrowing potential, lenders will make an allowance for each child within your affordability) Some lenders do also take child related payments such as child benefit and tax credits to help with this.
- And we will need 3 months bank statements as supporting documents
Your age:
Most lenders will lend to age 70 some to 75 and a few beyond. Age is important because it tells the lender how long you will potentially be earning for and therefore able to service your mortgage.
Amount of deposit and one-off fees:
Generally, the larger your deposit and/or equity from your current home, the less risk for the lender and they more they will lend. When moving, it is normal for most of the deposit for your new house to come from the equity of your existing one. As part of our mortgage assessment we will work out the one-off costs involved to buy and sell so that you have an accurate idea of how much deposit you will then have available. These are mainly stamp duty (where applicable), solicitors fees, a broker fee, a possible lenders and valuation fee.
Agreement in Principle:
Once we have determined your borrowing capacity, costs to buy, deposit and estimated monthly cost, we can now go ahead and obtain the lenders Agreement in Principle. Everyone is different and in an entirely unique situation so here at AIMS we treat you as an individual. We have the knowledge to match you with the lender most likely to say yes! We do this by assessing your criteria and matching it with the lender most likely to offer you the best loan for your circumstances eg. this could be borrowing the maximum amount possible so that you can buy a better home, a lender that is flexible if you have missed one or two credit card payments or will accept you if you have only been self-employed for 12 months.
Once a likely lender has been identified we will provide them with a snapshot of your situation by supplying them with
- The supporting documents to back up your earnings (wage slips, accounts etc.) and bank statements to back up your affordability, commitments and outgoings
- The verification of your identity by taking certified copies of documents such as passports, driving licences etc. together with an online Electronic Verification of Identity (EVID).
- They will carry out a credit check and credit score.
On acceptance the lender will then produce an agreement in principle which shows the estate agents and the vendor that you are serious and motivated and have got your finances in order, with a lender willing to provide you with the money.
Applying for your new mortgage:
You can rest assured that AIMS will then research the whole of the UK market to source that exact mortgage product to best suit you. We will present you with some options and work together to finalise the product, amount of mortgage and term you wish to take.
Your options when choosing a new mortgage:
The cost of the monthly repayments on your new mortgage on your new property is the driving factor behind how much the lender will allow you to borrow. This determined by both the term, or how many years you borrow the money over (which may be affected by your age), the type of product and the interest rate that you pay %.
The term:
This will impact the monthly payment; the longer the term, the lower the payment. Lower payments can seem attractive but using the term to lower them means that you are stretching the loan out, the drawback of this is that you end up paying more interest overall.
We will always try and find a happy medium for you with a term long enough to make payments affordable, but also as short as we can go to minimise interest.
As part of our aftercare and review process (see our re-mortgage area) we will keep one eye on the future and so if you did take a longer term initially to reduce your payments we may suggest shortening your term at a later date, once you are used to the monthly payment and have had a couple of years of pay rises etc. Working this way can reduce or even remove any of the adverse effect of borrowing over an extended term initially.
We have worked with many clients who have taken 10-15 years off their mortgage term and indeed settled their loans way ahead of what they thought possible by using this method.
The type and interest rate:
- Together we will discuss the many different types of mortgage products available with their variety of different interest rates and find the one that you feel comfortable with. These include –
- How you wish to repay, by capital repayment and interest or interest only.
- Whether you would like a fixed, capped, tracker, variable interest rate etc.
- Whether there are any product incentives eg. Cash backs.
- What are the various different fees are involved and can they be added on.
- This is where our expertise is essential in checking that we have the all relevant information and detail required so that the application process goes as smoothly as possible. NB. Your documents, wage slips, bank statements etc. may need to be updated at this stage and then when we are completely satisfied we will send your application to the lender.
The lender will:
- Instruct a surveyor to check that the property is in a suitable condition for them to lend on.
- Take your application through the underwriting process, where they scrutinise all your information. After this sometimes they will come back to us with additional questions or requests for further documentation. We try and anticipate these questions before they are even asked, our aim to make any additional requirements as minimal as possible.
Once the lender is happy with you and your property, having received a satisfactory survey report, they will grant your mortgage offer. There will be a copy for you, for us and your solicitor.
After mortgage offer :
- As well as securing the most favourable terms for mortgage finance we will also ensure that you have the correct and relevant level of protection in place should things go wrong, we are fully qualified and able to advise on life assurance. So once your dream house has been found and your offer has been accepted, we can advise on and arrange any related insurance products to protect your mortgage and home, such as life assurance, critical illness cover, home insurance etc. click here
- We believe that our job does not end as soon as your mortgage offer is approved, we will continue to work closely with solicitors and estate agents to ensure that you complete your purchase or re-mortgage in a timely manner and will be here to answer any queries whenever they arise in the future. So, having obtained and secured the finance we will then liaise closely with your solicitor to achieve a successful exchange and completion for you.
- AIMS Aftercare. With your agreement you will be added to our diarised review system whereby you will receive ongoing support and advise whenever deemed necessary, so that you can forget about your mortgage and rest assured that we will keep everything running efficiently for you. You will be contacted well in advance of your deal period ending to find the most appropriate and favourable deals.
