Welcome to the final instalment of our 7 part series of blogs in which we have set out to debunk the myths of applying for a mortgage. Click on the links below to catch up on the previous parts!
Read on for todays content!
"I have historic debt issues, so I won’t be able to get a mortgage"
First and foremost, you are not on your own for thinking this, and you most certainly are not the only person to have ever had missed or late payments on credit agreements. Don't panic!!!
Things can go wrong for many genuine reasons and often people have problems through no fault of their own. People are sometimes afraid that something in the background will preclude the opportunity of getting a mortgage so don’t bother to ask.
Today, unsecured credit is everywhere and if you have (or have had) bits of it here and there, it can be a bit of a challenge to manage and sometimes mistakes are made. That mobile phone contract you didn’t pay the final instalment on, that catalogue that you forgot when you moved home, the parking fine you ignored or the balance on your credit cards. Even historic County Court Judgements or Debt Management plans in the background do not necessarily mean that you cannot get a mortgage.
This type of lending is a big market and many large institutions will consider the problem, looking at why it happened, how much it was and how long ago the debt was settled. Remember that the financial crash of 2007 left lots of careful, honest and hard-working people exposed with many of them having to work to resolve these problems for years afterwards.
As we have already learnt this week, banks and building societies have to lend money to generate money so they have adjusted their criteria and developed products enabling them to do that.
There are millions of people who may not be able to boast that 100% PERFECT A+++ financial history that will still be viewed as good business and a good lending risk who can go on to successfully own their own home.
Beyond the mainstream we also have access to specialist lenders who actively seek out this kind of borrower so, even if you have already been told “No” by your bank or building society we will be happy to use our experience and knowledge to research the whole of market to see if you qualify for a loan.
Also, don’t be put off by thinking that the cost of these products are going to be extortionate because the specialist lenders want to cash in on your previous misfortune. Often, the specialist lenders are within 1% of the interest rates available on the high street. Bear in mind that interest rates are significantly lower than they have ever been, this “premium” that you pay for the specialist products still results in lending money at rates cheaper than some “good” rates that were available on the high street less than 2 or 3 years ago. And often, the specialist lenders product is a gateway to the high street – At the end of your fixed rate you will probably find that your credit has repaired significantly enough that you can remortgage to the over to the high street. We at Foursquare believe that many specialist lenders are “enablers” that allow you to get the house you want at the price you want now, with the future cost only reducing as time goes on. There's only one way to find out if you can or not...……..
Mortgage Mythbusters Week – A Summary
Let’s be honest, no one wants a mortgage, they need one.
A mortgage is never going to be the most exciting thing you buy. No one can see it, you can’t show it off, you can’t physically do anything with it and it costs you money every month. But don’t let that fool you into thinking that getting it right is not absolutely critical. Remember that your decision will live with you for 15, 20, 30 or even 35 years.
We appreciate that some people might find it a bit boring or may even be cautious because they don’t fully understand it. Plus, as we’ve seen this week, there are many “myths” doing the rounds about mortgages that often are completely unfounded. We know that there’s always someone in a friend circle or social gathering that claims to be the expert when it comes to something like this. You know the type, they have an opinion on something that is completely unfounded yet manage to say it with enough authority and confidence that people believe them.
When it comes to your mortgage, take a qualified opinion on your needs. At Foursquare, we are fully qualified experts and we won’t take up any more of your time than is necessary (in fact we will save you time because we do all the legwork). We will explain the detail in a way that you understand and, if you are not sure, we will go over it again until you are comfortable with it. At the end of your meeting or phone call with us, you will be better informed, myth free and hopefully on the road to buying or remortgaging your home.
If you’ve enjoyed or found this series of mythbuster blogs useful, we would love to hear from you. Tomorrow, we revert back to the normal weekly blog format. If there is a certain subject matter or topic you would like to see a future blog around, why not drop us a line?
Tune in tomorrow for our usual blog format! 😊