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Published on : August 13, 2021 10:17


Need a change of scene?


Buying a home can be very exciting as well as very stressful and to ensure you are fully prepared we have put together some key points that will help you along the journey of buying a home.

Whether you need more space, are downsizing, or simply moving on our Financial Services department will find a great mortgage or re-mortgage deal for you.

Our team of mortgage specialists work with a wide range of lenders including Halifax, HSBC, Nationwide, Santander and Virgin Money, and have access to some exclusive deals you will not find if you apply directly with the lenders.


Affordability


The amount you can borrow will be based on your income and affordability.

  • How much money do you need for your monthly living costs?
  • How secure is your job?
  • What your thoughts are on mortgage costs and mortgage rates
  • How much deposit do you have available
  • Do you have savings or access to additional monies should they be required

Thinking about the above requirements will give a picture of your lifestyle before a property purchase. It will show how you will be able to live once you have purchased a property.

A mortgage calculator can be used to see at a glance how much a mortgage could cost you to give you an idea of affordability, but knowing which mortgage is right for you can be tricky so speaking with a financial advisor will be needed. Currently, mortgage rates are at their lowest but remember there are fees and solicitor fees to add to the costs.

Depending on the capital you have at your disposal will also determine how much you can borrow.

Having capital will depend upon

  • The savings you have available
  • Do you have financial support from your family
  • Do you have an existing property to sell

Once you have everything together you will be able to work out what deposit you have available to you. By deducting costs of buying a property which includes moving expenses and improvements that we will be needed, remember to keep a little safety net for an emergency which leaves a final sum which is the deposit for your property. Make sure that you are not overstretching yourself.


Borrowing


Knowing how much money you now have for a deposit will then help you and your financial advisor work out how much you will be able to afford to borrow for a mortgage. Again the mortgage will also depend on a number of factors too.

  • How much cash do you have available as a deposit? The launch of 95% mortgages does make it easier especially if you are a first-time buyer but ideally the more deposit monies you have available the more you will be able to borrow.
  • Do you have any outstanding debt, like credit cards, bank loans, and financial commitments? All of this will be calculated together as one outstanding debt and not be included in your affordability
  • Your income, some banks will lend up to a maximum of five times your salary, remember all lenders have different criteria or lending. If you are self-employed or a freelancer and starting out or have not been in business long a lower mortgage lending amount will be offered.

Research


Once you have all your figures together of how much it is going to cost to become a homeowner along with how much it is going to be monthly for you, think carefully about your affordability to do this. This will be one of the biggest financial commitments you will make and you need to be sure that everything is affordable. If you cannot afford to pay your mortgage payments and you start to struggle it can result in your home being repossessed at a later date.

Some points that we offer to clients of Edward Mellor Financial Services are

  • Depending on the type of mortgage that you commit to will you be able to afford the monthly payments? A rule that lenders advise is that no more than 35% of post-tax income should go on a monthly mortgage payment.
  • Do you struggle at the moment with rental payments and can you afford to live comfortably? If you are struggling with what you pay at the moment and the mortgage is taking you over that amount you may need to reassess your figures.
  • There are some household bills that may have been included in your rent payment, for example, council tax, water, and insurances. These will now be bills that you will have to pay in addition to your mortgage payment. Can you also afford these bills on top?
  • Maintenance of your home is also another cost that is not included when you rent a home but you could find there are costly maintenance costs that can be unexpected. Could you afford to pay for a new boiler if the worst happened?
  • Think about fixing your mortgage rate for 2, 3, or longer. This will protect you if all of a sudden rates start to increase. But unfortunately, if rates drop your rate will stay as it is if you are on a fixed rate.
  • Protect yourself with critical illness cover or income protection. Look at insurances to protect you and your family and your home.

Contact the experts at Edward Mellor Financial Services


Our team of mortgage consultants will be able to offer new mortgage and remortgage rates that are not available within the open market. We work with over 50+ lenders and we will look for the best rate available for your circumstances. Get in contact today and you could be putting an offer on your dream home.

Whether you are looking for a mortgage, a re-mortgage or a buy-to-let rate – Edward Mellor Financial Services are here to help you get the best deal. Contact today on 0161 443 4830


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