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Category: MORTGAGE APPLICATION

MORTGAGE APPLICATION

  • What is a deed of postponement?

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    A Deed of Postponement is a legal document used in the UK mortgage market to change the order of priority of charges secured against a property. This document is typically used when a homeowner has more than one mortgage or secured loan and wants to take out additional financing, such as a further advance or… Read more

  • Second charge mortgages – the advantages and disadvantages

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    In the context of UK mortgages, a second charge refers to a type of secured loan that is taken out against a property that already has an existing mortgage. The second charge loan is subordinate to the first (or primary) mortgage, meaning that if the borrower defaults and the property is sold to repay debts,… Read more

  • Consumer Buy To Let

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    In the UK mortgage market, “Consumer Buy-to-Let” (CBTL) refers to a specific category of buy-to-let (BTL) mortgages that are regulated differently compared to standard buy-to-let mortgages. The distinction primarily relates to the borrower’s intention and circumstances under which the property is being rented out. Definition and Criteria A Consumer Buy-to-Let mortgage is designed for landlords… Read more

  • Stress ICR (Interest rate affordability stress test)

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    The interest rate affordability stress test is a crucial part of the mortgage application process in the UK. It is designed to ensure that borrowers can afford their mortgage repayments not only at the current interest rates but also if rates were to rise significantly in the future. This test is applied by mortgage lenders… Read more

  • Interest coverage ratio (ICR) explained

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    The interest coverage ratio (ICR) is a financial metric used to assess a company’s ability to pay interest on its outstanding debt. It is calculated by dividing a company’s earnings before interest and taxes (EBIT) by its interest expenses for the same period. The formula is: Interest Coverage Ratio=EBITInterest Expense\text{Interest Coverage Ratio} = \frac{\text{EBIT}}{\text{Interest Expense}}Interest Coverage Ratio=Interest ExpenseEBIT​ Importance of the… Read more

  • Gazumping: How prevalent is it in 2024?

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    What is Gazumping? Gazumping occurs when a seller of a property accepts a higher offer from a new buyer after having already agreed to a sale price with an initial buyer, but before the contracts have been exchanged. This practice leaves the initial buyer in a difficult position, often having invested time and money into… Read more

  • The advantages of renting over buying a property

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    Buying a home is one of the most significant financial commitments you’ll make in your lifetime. Navigating the complex mortgage market can be daunting, but using a mortgage broker can simplify the process and offer several advantages. Here’s why you should consider using a mortgage broker to arrange your mortgage: 1. Access to a Wide… Read more

  • Expenditure considerations when applying for a UK mortgage

    amoore70

    When applying for a mortgage in the UK, lenders conduct a thorough assessment of your financial situation to determine your affordability and ensure you can manage the repayments. This assessment includes a detailed look at your income, credit history, and expenditure. Understanding the types of expenditures that lenders take into account can help you better… Read more

  • Let to buy explained

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    “Let to buy” (LTB) is a property strategy where a homeowner rents out their existing home in order to purchase a new one. It is popular in the UK among people who want to move to a new property but don’t want to sell their current one. Here’s how it works: Key Benefits: Key Considerations:… Read more

  • Understanding subsidence: Causes, management, and implications for UK mortgages and building insurance

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    Subsidence is a concern that strikes fear into the hearts of homeowners, landlords, and insurers alike. It’s a phenomenon that can cause significant damage to properties and, if left untreated, can lead to costly repairs and insurance claims. In this article, we’ll explore what subsidence is, why it happens, how to deal with it, and… Read more