Struggling to get a mortgage?

If you are finding it difficult to get a mortgage, you can either struggle a lot or a little. Most of us would prefer the least amount of effort and tips available on http://www.moneysavingexpert.com/mortgages/boost-mortgage-chances provide some good advice on active steps you can take if you are finding it difficult to get a mortgage.

But, and there is a big but, there are other avenues open to you that sites like Money Saving Expert would prefer not to tell you about. These sites are mortgage brokers and advisors who are independent or 'whole of market' as the latest ludicrous phrase from the FCA comes into use.

Using this blog post as a case study, it can be easily demonstrated that independent mortgage brokers are far better placed to find suitable and competitive mortgages for all types of home buyer. Wythenshawe - part of Greater Manchester that includes the airport is an area of huge economic growth and has a very active housing market. If you were to approach a bank or building society to lend you the money to buy a property you would be letting yourself in for paying higher rates and getting a much worse deal than you would if you were to use one of the independent brokers.

Best Mortgage Deals (Manchester)

So what are the best mortgage deals currently available in the UK? Many people use the advice on Money Saving Expert and their advice can be found at https://www.moneysavingexpert.com/mortgages/best-buys/, but this is a countrywide assessment. Area specific deals exist, often supplied by micro lenders who have an in depth knowledge about certain geographical locations, one such area is Wythenshawe, but Greater Manchester is a property hotspot and local experts and brokers Manchester Mortgages (go to http://manchestermortgages.co.uk/ are able to provide excellent mortgage advice that will beat any offer from a large lender such as the Halifax or Virgin Money.

So whilst Money Saving Expert will provide decent UK wide advice, my recommendation is to also use a local mortgage provider / broker if you know the specific area you wish to live in. Using Manchester as an example (as it's where I live) I know that there are parts of Manchester where a lot of houses are being sold - such areas are Wythenshawe, Bury and the Wigan area. Now, the big UK web sites will give you a best rate of 2.39% fixed for the first 5 years of a 25 year term, but a Manchester mortgage broker was able to find me 2.19% fixed for 3 years with only a 12.5% deposit required. If I had a mortgage deal already, this deposit fell to 10%.

It's worth doing the extra maths and using a local or whole of market mortgage broker, especially in Manchester as the savings can be huge.

Does a poor credit rating prevent a mortgage ?

A common question mortgage advisers get asked is about credit scores and if a bad credit rating can prevent getting a mortgage to buy a house. Here's a typical question:

"I'm interested in seeing if I can obtain a mortgage but am worried my credit rating may be a problem.

Please could I make arrangements to speak to someone in this regard."

So in this enquiry the person obviously has some problem with some form of debt. Perhaps they are young and have to repay their student debt, or perhaps during the boom years of the noughties they overstretched themselves financially and to bridge the gap took out loans on 0% credit cards which they are now struggling to repay.

The subject of debt is of course huge, with many UK workers now on the minimum wage and zero hours contracts, what hope is there for buying a house for people in this position? The reaction has been that many people are now forced to rent houses because they can't afford the deposit to buy a house. The hour prices on the property market are also inflated as many people have chosen to invest in bricks and mortar rather than trust their money on the stock market. This has created a house price bubble as too many people, a second house is their investment and was bought when house prices were high. This keeps house prices (unrealistically) high as no one wants to loose money on their investment.

So, buying a house in todays Britain is tricky. It's tricky is you're in full time employment and have a good credit history. It's even more difficult if your circumstances aren't ideal and you think your credit rating may be a problem. Fortunately there is good news: mortgage advisers like Manchester Mortgages (http://manchestermortgages.co.uk/) are experts at finding mortgages for people with poor credit ratings. Most high street lenders will not consider many people with poor credit histories for a mortgage: this is a mistake. It's a mistake because people are increasingly running short of money and are having to work harder to make ends meet. This produces the follow-on effect that fewer people will be eligible for high street mortgages, this presents a huge opportunity for the likes of Manchester Mortgages and similar companies.

The difference an independent mortgage lender can make is huge, and in my opinion the days of the high street mortgage business model are over: these services are old and out-dated. An independent mortgage adviser will look at hundreds of mortgages from a huge number of different lenders and will also speak to them personally, describing people's credit situations (see the page specific to bad credit mortgages at http://manchestermortgages.co.uk/poor-credit-mortgages/) in detail and filling in a mortgage application with the correct information to ensure that a mortgage offer is given rather than rejected.

So in summary then, having a poor credit rating will certainly cause difficulty in getting a mortgage, and the best way of getting around the problem is to use an independent broker as described above.



Wythenshawe - A Great Place To Buy A House

I've recently been working closely with Alan Dee, a mortgage broker from Wythenshawe, whose company, 'Manchester Mortgages' arrange a lot of mortgage deals for house buyers not only in Wythenshawe but also the more expensive surrounding areas of Cheadle and Gatley (see http://manchestermortgages.co.uk/wythenshawe-mortgage-broker-advisor/ for more).

In a recent Manchester Evening News article (http://www.manchestereveningnews.co.uk/news/greater-manchester-news/wythenshawe-the-new-didsbury-house-9419435), Wythenshawe was termed the new Didsbury - a rather posh and Bohemian area of Manchester.

I met with Alan for a coffee in Wythenshawe's busy town centre and discussed the apparent housing boom that was going on all around us.

"It's only a few years ago that nobody wanted anything to do with Wythenshawe" said Alan, "there were lot's of empty homes and the area had a very bad reputation". Recently though this has changed and I asked Alan why he thought this was. "It has a lot to do with the development of Manchester Airport, which is only a couple of miles away. This has bought a huge amount of new business to the area, and that good because house prices in Wythenshawe are still affordable, whilst many other  areas such as Cheadle and Gatley aren't. Also, there's been a lot of redevelopment of the Wythenshawe as a whole - many of the older properties that were is disrepair have been pulled down and whole areas have been redeveloped. This had attracted many new people into the area - it's a great place for first time buyers and buy to let housing."

I went on to ask Alan how difficult it was to get a mortgage in Wythenshawe? "It depends who you go to" he offered. "The high street lenders like the banks will still make you jump through hoops and then it'll take several months to even get the mortgage application process up and running. With an independent or 'whole of market' mortgage broker like Manchester Mortgages, we can give people the best deals available from all the lenders and usually get a mortgage offer out to people within a week".

Was it difficult using a mortgage advisor like Manchester Mortgages I asked Alan? "No, it's not hard at all, we do all the paperwork and fill in the application forms. Also as we have so much experience in providing mortgages we can advise people on the best type of deals and even tailor deals specifically to suit them. A big area for us is getting mortgages for people with bad credit ratings. Many banks and high street lenders won't touch people with a large amount of debt, we do, and we often find them mortgages too" said Alan.

After our coffee I took a walk around Wythenshawe a noticed that it really is an up and coming area - full of potential and promise for the future.



Mortgage Terminology

I came across this very helpful guide about the terms used in mortgage brokering.

WHATS A FIXED PRICE ?
When properties are advertised at a fixed price this means that the seller ( vendor ) is looking for that price and not looking to negotiate / accept a lower figure – therefore if the asking price is £ 200,000 that is what the seller wants – it does not stop you however offering less.

WHAT DOES OIRO MEAN ?
OIRO means ‘ Offers in the Region Of ‘  therefore if a property is advertised at OIRO £ 200,000 the seller is looking for a figure around this amount but would indicate that they would accept a lower figure – for example £ 190,000 or £ 195,000 so always worth starting off with a lower offer.

WHAT DOES OIEO MEAN ?
OIEO means ‘ Offers in Excess Of ‘ therefore if a property is advertised as OIEO £200,000 the seller is looking for offers above this figure – for example £ 210,000/ £215,000 etc – again through there is no reason why not to offer a amount below the £ 200,000.

WHAT DOES GUIDE PRICE MEAN ?
A Guide Price is usually associated with a property that is going to be sold at Auction – therefore the Auctioneer has advertised a price that they feel is the minimum the property should sell for – usually in reality properties at auction usually sell for much more than their Guide Price and is a way of attracting purchasers to the auction.  

WHAT DOES CORPORATE SALE MEAN ?
When a property is advertised as a Corporate Sale it usually means that the property has been repossessed by a Bank or Building Society as the mortgage client has defaulted on the mortgage payments and the lender has appointed a company to sell the property to repay the mortgage / loan outstanding on it.

Corporate property sales are usually done via an Estate Agency, the main disadvantage is that you have to go through the Estate Agent to negotiate the price with the company and this can be a very slow process and even once your offer has been accepted the property will remain on the market until you exchange contracts – therefore you could have paid for a valuation, solicitors search fees and lenders admin fees and about to exchange when the corporate company accepts a higher offer from  somebody else.   

MAKING OFFERS
Always consider making a lower offer whatever the price or condition put on it – start low – you can always increase the offer at a later date.