Our Guide to Mortgage Jargon

Our Guide to Mortgage Jargon

Taking out a mortgage is a huge financial commitment, and so you’ll want to feel you’re clear on what you have to do and when – and exactly what you’re getting.

When you start looking at and applying for mortgages, there seems to be a whole world of jargon to get your head around, some of the words and phrases you won’t have heard in any other situation – from arrears to valuations – here we take a look at the vocabulary you’ll need to understand.

If you would prefer to talk with an Expert Mortgage Advisor and have a straight-forward conversation about your Mortgage needs with simple explanations – Please give us a call on: 0800 197 0504.

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Mortgage terms explained

Arrangement fee

This is a set-up fee for your mortgage. Most mortgage lenders will let you add this fee to the loan, but this means you’ll be paying interest on it for the whole mortgage term.

Arrears

An account is said to be in arrears if monthly payments aren’t kept up to date with. When this happens, the mortgage company is likely to apply extra charges on top of their monthly payments – and the fact that your account has gone into arrears could be noted on your credit file.

Base rate

The base rate is the rate the Bank of England charges other banks and lenders when they borrow money. This influences the interest rates that many lenders charge for mortgages, loans and other credit they offer customers

Booking fee

A booking fee is charged up front and pays for ‘booking’ in the loan while your application goes through. It’s sometimes also known as an ‘application’ or ‘reservation’ fee. This fee can’t be refunded if you end up not taking the mortgage out.

Broker

A mortgage broker is a financial adviser who specialises in offering advice on mortgages. They can help by saving you time and stress when applying for a mortgage, because as they’re doing this day in day out, they know which mortgage lender might give you the best deal, based on your individual situation. They can also help you a great deal with the application process itself.

Buildings insurance

This is a (usually compulsory) policy that covers damage to the structure of your home such as the walls, roof and floors, and it usually covers damage to fixtures and fittings too. So if you’ve got a fitted kitchen for instance, your insurance is likely to pay for any repairs needed.

Buy-to-let mortgages

These mortgages are especially for landlords who want to buy a property to rent it out. The rules around buy-to-let mortgages are similar to those around regular mortgages, but there are some key differences which a good broker would be able to help you to understand.

Completion

The final stage of the conveyancing process after exchange of contracts – when keys change hands and the mortgage is officially started.

Early repayment charge

Although you may be able to move house and/or remortgage at any time with some lenders, an early repayment charge will be incurred if you repay the capital within the early repayment period – the repayment period will be stated on your contract.

Exchange of contracts

The point at which signed contracts are exchanged by the legal representatives (usually the solicitors) of the buyers and sellers in the process. At this point, the contracts are legally binding, the deposit is paid and in general everyone can rest assured the move is going to happen.

Fixed rate mortgage

With a fixed rate mortgage, your mortgage repayments stay the same for the time period (the term) of the mortgage deal. This has the advantage that you know exactly what you’ll be paying each month, however the disadvantage that if the Bank of England Base Rate changes, you won’t reap any potential rewards either.

Guarantor mortgages

Getting a guarantor to help support your mortgage application could help you buy a property when you have a small deposit, or low income. You’ll need a relative or friend who is willing to be named on the mortgage with you and make any payments you miss.

Interest

Like with most loans, as well as paying back the capital you borrow, you will also have to pay interest on your mortgage – i.e. extra money on top of the capital divided into monthly repayments. This may be calculated on a daily or annual basis, depending on the specific terms and conditions of the mortgage – all of which should be explained in your mortgage agreement.

Interest only mortgages

As the name suggests, with an interest only mortgage, you’ll only pay back the value of the interest each month, rather than paying off the actual property value itself. So, with this mortgage your monthly payments should be lower than with a regular mortgage, but at the end of the term you’ll still owe the original loan amount.

Joint mortgage

A mortgage that’s taken out with two or more people named on the contract. All people named have responsibility for meeting the repayments.

Loan-to-value (LTV)

The loan-to-value ratio is how much you’ve borrowed with a mortgage compared to the value of your property – so this depends on how much of a deposit you can afford to put down. It’s calculated as a percentage, and typically, the lower your LTV, the better chance you have of getting a lower interest rate.

Life insurance

This kind of insurance usually pays a tax-free lump sum of money in the event of your death within the policy term, which can be used to pay off your mortgage. This is a tax-free sum, that’s usually decided on at the time of applying for the policy.

Mortgage term

This is the length of time you have to repay your mortgage. The typical mortgage term is 25 years when you take it on, but they can be much shorter or longer depending on factors such as your age, and how many years you’ve had a mortgage for before.

Negative equity

When a property is in negative equity it is worth less than the mortgage secured on it, this is usually caused by falling property prices.

Remortgage

This is when the homeowner pays off one mortgage with a new mortgage using the same property as security. People choose to remortgage for various reasons, but usually it’s to bring down the overall monthly mortgage payment amounts.

Stamp duty

Stamp duty – a tax that’s paid when buying a property – it’s paid by the buyers. It is paid at the point of completion, and the amount is related to the price being paid for the property.

Tracker mortgages

Tracker mortgages are a type of variable rate mortgage. What makes them different from other variable rate mortgages is that they follow movements of another rate. Usually, the rate they track (follow) is the Bank of England Base Rate.

Variable rate mortgage

Here your mortgage rate will move up and down over the time you have it, meaning that your mortgage repayments won’t always stay the same. The main cause for this is the UK economy. If you’re using a mortgage broker, they might be able to offer their opinion on whether it’s a good time for a variable rate mortgage

Valuation

Before agreeing to provide a mortgage, the lender will arrange for a valuer to look over the property to check how much it’s worth and assess its suitability for the mortgage amount that’s being taken out.

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Can I Get A Mortgage With Bad Credit?

Can I Get A Mortgage With Bad Credit?

When you apply for a mortgage, the lender tries to predict your reliability for making your repayments responsibly, based on the way you’ve acted in the past. To do this, they look at lots of different data that’s stored on your credit file. This might include how many applications for credit you’ve made recently, how much you owe, what credit products you’ve had and whether you paid them off on time.

If you have a bad credit score, mortgage lenders are less likely to lend to you, and you might have already been declined by a lender. But all is not lost. We help people every day who are worried they won’t be able to get a mortgage due to their bad credit situation – so don’t give up hope, we might be able to find a good mortgage deal that’s just right for you.

The advantages of using a broker

Using a broker like Clever Mortgages to help you get a bad credit mortgage could increase your chances, and this is partly because many of the mortgages available to people with bad credit are only available to brokers, and not directly to the public.

So, no matter how hard you try to apply to some lenders, they simply won’t lend to you unless you’re with a broker. We help customers with bad credit get the mortgage that’s right for them – and that’s because we know the lenders that are most likely to say ‘yes’, and to give the best rates.

Bad Credit Mortgage Experts 5 Star Trust Pilot

When you enquire with us, we’ll ask about your income (you’ll need to have various documents, such as payslips and bank statements showing your salary going into your bank), all your outgoing details, and we’ll find out from you the total amount you want to borrow, as well as any deposit you have to put down. The bigger the deposit, usually means the better likelihood of getting a good deal.

Consider a joint application

If your partner has a more favourable credit score than you, it could be worth considering a joint mortgage, as then their credit history will be taken into account too.

Together you might have a bigger deposit and can both bring your salaries into the equation – making you a much more appealing prospect to lenders.
Some quick facts about taking out a joint mortgage:

• Most joint mortgages are taken out with two people on them, but some lenders will allow up to four.
• Everyone named on the mortgage is responsible for making sure repayments are made.
• Most joint mortgages are taken out by couples, but you can also take out a joint mortgage with a friend, or a family member, or even a business partner you want to share a new investment with.

Make sure you can afford your repayments

Bad credit mortgages will typically involve higher interest rates, which will mean repaying more money each month. So you’ll need to work out exactly what you’d be expected to pay and decide whether you can afford this as well as all your other outgoings.

We can help advise you on what your mortgage repayments might be.
Here’s what you’ll need to consider:

• Make sure you know exactly what your mortgage repayments will be. You can use our online mortgage calculator to give you an idea of what to expect.
• Write down and add up all of your monthly outgoings – petrol, food shopping, leisure, bills – and don’t forget to leave some extra each month, for the unexpected, e.g. your car needing some work, or something in the house going wrong.
• Consider what you’d do if your situation changed, make sure you think about a mortgage insurance plan that’s right for you.

Consider getting a guarantor

If you’re unable to get a mortgage because of bad credit, a family member or close friend, might be in a position, and willing, to be named as a guarantor. Getting a guarantor is a big step, as you and your guarantor will be tied to each other financially for the term of the mortgage. This can impact on both of your credit ratings.

The guarantor would often have to state they’ll secure the mortgage against their house (or another large asset), which means that if you defaulted on your mortgage payments the guarantor may be liable.

Getting a guarantor doesn’t remove the need to be credit checked, but it can mean that if you do have bad credit, you’ve got a better chance at getting a mortgage.

How to improve your credit score

A good credit score can help increase your chances of successfully applying for a mortgage – and get you a better rate too. Ways to improve your credit score include:

  • Keep credit card balances low.
  • Check for any mistakes on your credit file. Your credit score may be negatively affected if information about your financial history is incorrect on your file.
  • Stay within agreed overdraft limits. Speak to your bank if you’d like an overdraft on a current account, but make sure you stick within the agreed limits.
  • Make sure you’re on the electoral roll for your current address.
  • Don’t make too many applications for loans or cards – too many applications, especially in a short space of time, can have a negative effect on your future score.
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Is The Help To Buy Scheme Really Helping?

Is The Help To Buy Scheme Really Helping?

A new report by the National Audit Office (NAO) shows that many of people on the Help to Buy scheme could have afforded a house regardless – now some of those buyers are in negative equity, and in a situation far worse than if they’d gone it alone.

Firstly, what is the Help to Buy scheme?

Help to Buy was launched in April 2013 by former chancellor George Osborne as a way of getting more buyers onto the property ladder. It’s open to both first-time buyers (who it was largely aimed at) and home-movers too, but is only ever available for buyers of new properties. Essentially it involves:

  • The buyer has to have at least 5% of the sale price of a new-build flat or house as a deposit.
  • The government lends the buyer up to 20%, or 40% if you live in London, of the sale price. This loan is interest-free for five years. Afterthe interest-free period, buyers are charged 1.75% on the outstanding amount as interest. This fee increases each year by Retail Price Index plus 1%.
  • The buyer borrows the rest (up to 75%, or 60% if you live in London) from a mortgage lender, on a repayment basis.
  • Buyers need to repay the equity loan in full after 25 years, when the mortgage term finishes or when you sellyour home – whichever happens first.

The scheme is currently due to end in 2023, bringing an end to a flagship loan programme that currently divides financial critics – some feeling it boosted, and others that it harmed, the UK property market.

It’s now been used to support more than 200,000 purchases. It was introduced by the government with the aim to improve on a falling in property sales, following the financial crash in late 2008, and the tightening of regulations over the availability of high loan‑to‑value and high loan-to-income mortgages that followed on from this.

Michelle Neville, Sales Director at Clever Mortgages tells us: “At Clever Mortgages we fully understand the needs and drivers for first-time buyers.  We help people day-in-day-out get their first mortgage secured, and we know from speaking to our customers how tricky it can be to get on the property ladder. But sometimes customers are surprised that getting a mortgage can in fact be easier than they first think, and with our guidance they can find ways of borrowing more, even with less deposit. We work with a trusted range of lenders, and all have their specialisms for differing needs.”

So, what are the criticisms of the Help to Buy scheme?

The new report suggests that some buyers using the scheme risk finding themselves in negative equity. The National Audit Office also highlighted figures showing that many people using the government’s Help to Buy scheme could have purchased their properties without it.

Perhaps surprisingly, the scheme isn’t means tested. Around one in 25 home buyers using the scheme had household incomes of over £100,000, 10% of buyers had household incomes of over £80,000, or over £90,000 in London, the National Audit Office (NAO) said, and so could have afforded to buy their own home themselves, even if it wasn’t in their ideal location.

The Help to Buy scheme can be a useful aid for many people, but it’s not always the most suitable option. If you’re a first time buyer considering the Help to Buy scheme, speak to us first to see if it really is the most suitable option for you’.

Help to Buy and the property market

The Department’s independent evaluations of the Help to Buy scheme show it has increased home ownership and housing supply – and has therefore achieved that goal, or at least in the short-term.

Housing firm Persimmon, for example, is the biggest beneficiary, with almost 15% of the sales made under the Help to Buy Scheme. Redrow made up 3.7% of sales, Bellway accounted for 6.7%, Taylor Wimpey made up 11.9%, and Barratt made up 13.3% %, according to the NAO’s analysis.

The report states that the government will aim to wean the property market off the scheme over the coming years, whilst still ensuring that developers continue to build new properties at the rates they are doing at the moment.

I’ve bought a house with Help to Buy – what next?

If you’re concerned about the findings from the report, and aren’t sure when or how you can end  your commitment to the scheme, or whether you’re in negative equity, now’s the time to seek advice.

  • Now’s the time to look into your situation – waste no time in gathering your documents, and setting aside some time to review them to find out exactly where you stand.
  • Crucially, find out whether you’re in negative equity. Negative equity means that your house value is less than what you owe on it – so you’ll need to know what your house is worth now, and what your current mortgage balance is.
  • Find out the terms you had when you took out the scheme – there’ll most likely be a set amount of time you have to pay the loan off over.

Seek expert help. It might be time to remortgage, we help customers every day find a great remortgage deal that’s right for them, even if they have bad credit.

We can help

Clever Mortgages help first time buyers every day to take their first step on the property ladder. If you’re moving house and want to speak to one of our expert brokers about next steps, get in touch today.

Michelle Neville says, “Do get in touch, our brokers are experts in finding the right lender whatever the situation. We can offer advice to you if you’re on the Help to Buy scheme and aren’t sure what your next move should be – or if you’re a first-time buyer who’s exploring your options.”

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What is the difference between fixed and variable mortgage rates?

What is the difference between fixed and variable mortgage rates?

Deciding on a mortgage may well be one of the hardest decisions you ever have to make, so it’s important to assess and understand all the options available to you.

Fixed-rate mortgages

A fixed-rate mortgage is where your interest rate – and thus your monthly payment – remains the same throughout the agreed period, typically between 2 and 5 years. By contrast, the repayments on a variable mortgage are ever-prone to change, depending on interest rates.

Perhaps the main advantage of a fixed mortgage rate is that your monthly repayment remains the same throughout the agreed term. This can offer you peace of mind, with the predictability of the arrears allowing you to budget each month around your mortgage repayments.

Because of their security, fixed-rate mortgages are often the more expensive and sought after of the two options. Their popularity means there are many providers constantly in competition with each other though, so it it’s always worth speaking to a mortgage advisor to find the best deal.

Variable-rate mortgages

The option of a variable mortgage rate is undoubtedly the riskier of the two. If interest rates rise drastically – which they may well do – It could turn out to be significantly more expensive. On the other hand, there is always the chance that you’ll end up with a lower monthly repayment, making the variable rate cheaper. The catch is the uncertainty.

If you’re unhappy with your variable mortgage rate, or you’re coming to the end of your fixed term, you may be thinking about changing your mortgage lender. The Money Advice Service also recommends reviewing your mortgage regularly. With the competitive mortgage market constantly churning out great new deals, shopping around for a new mortgage lender can potentially save you thousands of pounds.

The mortgage market is as complex as it competitive. As such, it’s always a good idea to speak to a mortgage adviser, who will explain all the options available to you.

At Clever Mortgages we focus on providing lending advice and solutions specifically tailored to your needs – whilst providing a service you can rely on throughout the process.

If you’re looking to switch your mortgage provider, get in touch using our simple enquiry form or give us a call on 0800 197 0504.

Top 10 Mortgage Questions Answered

Top 10 Mortgage Questions Answered

Moving house is stressful enough, and getting a mortgage in place can feel really daunting. With so many different products and rates available, it’s hard to know where to start.

Taking a mortgage out is a big step and has long-lasting financial implications. The last thing you want to do is enter into one without being fully informed and knowing all the facts. To help clear things up, we’ve picked 10 of the most frequently asked questions we receive about mortgages, and we’ve answered each one of them for you.

  1. What is a fixed-rate mortgage?
  2. What is a variable-rate mortgage?
  3. What type of debt is a mortgage?
  4. How much deposit will I need for my mortgage?
  5. What should I do if I can’t afford my mortgage payments?
  6. When will the interest rates on my mortgage go up?
  7. Can I get a mortgage with a poor credit rating?
  8. How long will it take me to get a mortgage?
  9. If my income goes up, can I pay my mortgage off more quickly?
  10. What happens when I’ve finished paying my mortgage off?

1. What is a fixed-rate mortgage?

Fixed-rate mortgages are one of the most popular mortgage types on the market. With a fixed-rate mortgage the payment stays the same for the term of the rate, which will usually be between 2-5 years. At the end of the fixed term the rate usually reverts to a standard variable rate for the remainder of the mortgage – unless you switch product.

The main appeal of fixed-rate mortgages is that you’ll have the peace of mind you won’t pay anymore than what you agreed throughout your whole fixed term period – so you’ll know exactly what you’ll be paying each month. The downside is that fixed-rate mortgages tend to involve slightly higher monthly payments than variable ones, plus you won’t benefit if interest rates fall.

2. What is a variable-rate mortgage?

If you decide to opt for a variable-rate mortgage, you need to be aware that the interest rate on it can change at any time, affecting your repayment amount. If the interest rate lowers you’ll be paying less on your mortgage, but if it increases you’ll end up paying more. It’s a good idea to have funds available to accommodate a potential rise in interest rates, if you decide variable-rate is the way you want to go.

3. What type of debt is a mortgage?

A mortgage is classed as a secured debt, because the money you’ve borrowed is secured against the home you’re buying. If you fail to keep up with your repayments, your home could be repossessed.

4. How much deposit will I need for my mortgage?

This can vary depending on factors like your credit score, the lender you opt to borrow from and how much you’re looking to borrow. Generally speaking, however, you’ll need to put down at least 5% of the property’s value to secure the mortgage.

5. What should I do if I can’t afford my mortgage payments?

If you can’t afford to make your mortgage payments you need to contact your mortgage provider immediately. Burying your head in the sand and missing payments is the worst thing you can do – repeatedly missing payments can not only have a negative impact on your credit rating, but also potentially result in your home being repossessed.

6. When will the interest rates on my mortgage go up?

This is dependent on the type of mortgage. With a fixed-rate mortgage, your payments won’t change until the end of the term, at which point they could go up or down, dependant on the rate at that time.

With a variable-rate mortgage, the payments could go up or down at any time.

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7. Can I get a mortgage with a poor credit rating?

If you’ve been in debt before or entered into a debt solution, you might’ve heard you won’t be able to get a mortgage until you’ve improved your credit rating, but this might not be the case. Bad credit mortgages (also known as sub-prime mortgages or adverse credit mortgages) are available for people who’ve had some financial problems and have blemishes on their credit report.

We specialise in mortgage advice for people with less than ideal credit ratings so you could get the mortgage you need now, rather than having to wait for years. What’s more, after you’ve repaid your bad credit mortgage for a few years, your credit score should have improved, meaning you could remortgage to a standard lender with different interest rates if you wish.

8. How long will it take me to get a mortgage?

This varies depending on your situation, but generally speaking it’ll take between one and two months for a typical mortgage to be processed. This is after you’ve spent time browsing the mortgage market and weighing up the options to decide what mortgage you want to go for. Remember, entering into a mortgage is a huge decision, and you shouldn’t rush into it – make sure you’ve given yourself ample time to compare mortgages from a range of suppliers before you pick one.

9. If my income goes up, can I pay my mortgage off more quickly?

You can – but you should be sure that you can afford to do so before you consider it. As long as you’ve got enough excess cash in reserve for things like emergencies or unseen costs, paying your mortgage off early can be very beneficial. Not only does it mean you’ll have paid your mortgage off early, it also means that you could also pay less in interest due to making a lump sum payment. Just bear in mind there could be an early repayment charge though, so make sure you check with your lender first.

10. What happens when I’ve finished paying my mortgage off?

You’ll have paid off all the debt secured against your home, and your mortgage lender will remove any charges against your property they have on their system.

Want to get started?

Contact us now about finding a mortgage for you. Speak to one of our brokers, or fill in our simple enquiry form and we’ll go through all your mortgage options.

Why Should I Bother To Remortgage?

Reasons to Remortgage and Improve Your Home

Remortgaging can help you to save money every month, and be a good way to get a lump sum of money, instead of taking out a personal loan.

What is a remortgage?

A remortgage is when you take out another mortgage on your home to replace your current loan or to borrow extra money against your property.

Why would you want to remortgage?

You would remortgage a property to either raise or save money:

Raise money

You can raise money by releasing equity in your home and taking out a new mortgage that is larger than your existing one. You could do this to consolidate debts, make home improvements or fund something else in your life.

Save money

You could save money by remortgaging and switching to a cheaper mortgage provider. You will need to check the terms of your contract though to make sure you aren’t charged any early exit fees.

How could you improve your home?

If you can release equity in your property, you can use these funds to improve your home and potentially increase its value. You may be able to build an extension, make repairs or update a property to raise its market worth. This could prove to be a sound investment in the long-term, but we’d advise you seek expert advice before deciding to borrow money against your home.

What are the risks of remortgaging?

When you remortgage for a larger amount than your property is worth, you are borrowing more money against your home. If you borrow money and do not keep up with the agreed repayments, your home could be at risk.

If you feel you cannot commit to higher repayments than you are already on, we’d advise you consider remortgaging to release equity with caution.

When shouldn’t you remortgage?

You should not remortgage if your existing mortgage debt is small or if your property’s value has dropped. If your repayment charge is large or if you have little/negative equity in your property, we’d also advise you steer clear of remortgaging, as this won’t benefit you in the long run and could put you at a financial detriment.

Get advice today

If you are looking for expert advice on remortgaging your property, contact our team today. We will be happy to help advise you on what you can do to release equity and switch mortgage provider.

We are experts in offering solutions to people with bad credit and can help you if you need a helping hand with your next move. Visit www.clever-mortgages.co.uk today.

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What is the difference between a secured and unsecured loan?

What is the difference between a secured and unsecured loan?

Secured loans

As the name would suggest, a secured loan is one that’s secured against something you own – for example, if you can’t afford to make your mortgage payments or keep to the arranged repayment schedule then you could risk a tarnished credit report or further action.

There are many reasons to select a secured loan over other options such as credit cards. We have gone into these in a little more depth below to give you an overview on their features and benefits, in what situations they could be beneficial and what considerations you should make before progressing with a decision.

Another example of a secured loan could be an equity loan which is simply a second mortgage In this example you would borrow a lump sum from your property and pay the loan back on a monthly repayment schedule over a period of 5 to 15 years.

What are the benefits of a secured loan?

Generally speaking, secured loans will have the option of longer repayment periods than unsecured ones, meaning they might be more affordable for you in terms of monthly payments. They also tend to let you gain access to much lower interest rates than unsecured ones.

Because the loan is guaranteed against something, you can generally get secured loans for larger total loan balance than unsecured loans.

Secured loans are also good if you’ve got a bad credit history – lenders probably won’t be willing to lend to you if you’ve been in a debt solution or have a poor history of paying back unsecured debt, but secured credit may provide the confidence they need.

The loan could be used for a any legal purpose which could also include combining unsecured debt and credit cards within a debt consolidation loan.

Unsecured loans

Unsecured loans are simply ones in which you borrow money and agree to a fixed repayment schedule, but don’t secure the loan against any kind of property. A standard bank loan, for example, would be classed as an unsecured loan.

A payday loan would also fall into this category as you aren’t securing it against anything, but are promising to pay back a large amount of interest relative to what you’ve borrowed from the payday lender. Payday loans may also offer revolving credit accounts which encourages repeated borrowing from the same provider without having to reassess lending criteria or fill in a new full application.

Unsecured credit is likely to be lent on a lower total borrowing limit, a shorter repayment schedule and whilst unsecured loans aren’t directly secured against anything you own, if a borrower defaults it can result in unsecured debt, the consequences of which could mean that your possessions are seized by bailiffs or become secured debts unless you come to an agreement with your lender.

What are the benefits of an Unsecured loan?

Loan providers can lend to more people because you can get one without owning any property, like a house, a car or a recreational vehicle.

If you’ve got an excellent credit score, then the best deals will be available to you at a higher credit limit. The downside to this, of course, is that if you’ve got a poor credit score or credit rating then you’ll probably find it hard to get a good (or fair) deal on an unsecured loan.

Some unsecured loans might give you the possibility of a payment holiday (where you don’t make any repayments) for a few months before you start paying anything back, but these are subject to your potential lenders policies and may not come as standard.

We work closely with over 100 lenders and can find the most suitable solution from over 1,000 products. Your potential lenders can look at a wide variety of personal circumstances, so if you’re looking for secured finance, a mortgage loan or a personal loan, get in touch using our simple enquiry form or give us a call on 0800 197 0504.

Find your best secured loan Deal

Expert secured loan advice, access to 1000+ products with over 100+ lenders and options for bad credit ratings – Enquire with Clever Mortgages today.

Releasing equity from your home

What is equity release?
Equity release is a way to obtain money quickly by releasing it from the value of your property. You will lose ownership on a proportion of your property but will still be able to live in it. Read on to find out how to release equity in your home and see if it is the right option for you.

What is equity release?

Equity release is a way to obtain money quickly by releasing it from the value of your property. You will lose ownership on a proportion of your property but will still be able to live in it. Read on to find out how to release equity in your home and see if it is the right option for you.

Why should you release equity?

Equity release may be a suitable option for you if you are looking for immediate cash without having to leave your house. It may also be an option to consider if you don’t have many savings and do not intend to leave a large sum of money behind in your will.

We’d advise you speak to a specialist adviser before opting for equity release and make sure you fully understand the details of opting for this mortgage option. The interest rates on an equity release arrangement may be higher than a standard mortgage arrangement, so you should consider all options before agreeing to one.

How does equity release work?

There are a couple of equity release schemes available and you should consider all options carefully before committing to one. One of the following home equity release options may be suitable for you:

A Lifetime Mortgage is aimed at homeowners over 55 years old who are looking to borrow money and remain living in their property. If you choose this option, you will only need to pay your money back when you die or go into full-time care.

A Home Reversion Plan is suitable for people over 65 years old who are looking for a way to raise money. If you opt for this, you will sell your property in return for tax-free cash – between 20% and 60% of its market value – but can continue to live there. You then continue to live in your home as a tenant without paying rent, providing you keep the property well maintained and take out building insurance.

Equity release considerations

There are a few things to consider before opting for an equity release:

  • Your property will not immediately be handed over to your beneficiaries when you die. However, you can protect some of the property’s cash value to use as an inheritance.
  • If your circumstances change after agreeing to an equity release, you may not be able to rely on your property if you need money later on in your retirement for medical emergencies or other events.
  • You may find the benefits you are entitled to change after releasing equity from your home, as this will be viewed as a change in income.

Get advice today

If you are looking to release equity in your property and raise some much-needed cash, call one of our expert advisers today on 0800 197 0504 or visit https://www.clever-mortgages.co.uk/apply-for-a-mortgage/

How to improve your home on a budget

How to improve your home on a budget

One of the first things you’ll probably think of when you hear the words ‘home improvement’ is, surprise surprise, money.

Whilst it’s true that some people splash thousands upon thousands on the latest mod cons, expensive extensions and costly conversions, the majority of people just don’t have wads of cash lying around. This doesn’t, however, mean you can’t make some fantastic home improvements on a budget. Sound good? Here’s a few of them:

• Install some skylights
• Add a fresh coat of paint
• Decorate with a stair runner
• Add some outdoor seating
• Don’t forget the front of your house!

Install some skylights

Do you have an attic room? If so, then skylights should be one of the first ideas on your list. They come in at a total cost of around £1,000, but are still a relatively uncommon renovation and, as such, can add a unique touch to your home. Aside from bringing in much more natural light than a normal window, they look amazing on a clear night and are great for ventilation in the summer too.

Add a fresh coat of paint

Re-painting your rooms is a great way to inject some personality into your home. Sure, it might have seemed a good idea to get clean-looking beige walls everywhere a few years ago, but going for the safe option isn’t necessarily the best one.

Colours like jewel green or deep purple are great choices to make your home seem much more unique, and the best thing about painting is that it’s pretty cheap too. It’s unlikely you’re going to have to spend more than £100 per room to re-paint it, yet painting remains one of the most powerful ways to change the entire character of your home.

Decorate with a stair runner

Stairs are one of the first parts of a home to lose their sheen (especially if you’ve got young children running up and down them all the time) and can spoil the rest of your house’s look if you’re not careful. Fortunately, installing a stair runner not only solves this problem (and is relatively cheap), but looks great too!

Opt for trendy Aztec patterned designs to give your stairs some character, or go ultra-cosy with softer luxurious materials. If you’ve got kids running around the house 24/7, then you’ll be pleased to know you can choose hardwearing materials that still bring a touch of style to your staircase.

Add some outdoor seating

If you’re lucky enough to have a back garden, then you should always make the most of it if you want to improve the value of your home. Aside from basic touches like keeping your grass cut and fending off weeds, adding some outdoor seating is a must if you’ve got the room. Being able to relax outside in privacy and enjoy a drink or a barbecue in the summer is one of life’s greatest pleasures, and you can get very fairly priced outdoor seating and tables if you shop around.

Don’t forget the front of your house!

Your front windows, door, porch, driveway and garden (if you have one) are the first things people see when they look at your home, so why not make a good first impression? If you’re thinking of selling your home in the future, then revamping the front of your house is a sure-fire way to boost your home’s value for a relatively small cost.

Even minor changes like getting a new door, painting your window ledges or adding some outside light features can really make your home stand out amongst the crowd and, potentially, attract a buyer.

If you’re planning to improve your home, whether large-scale changes or lots of smaller changes speak to us now about our range of finance solutions.

Moving house – a countdown to move day

Moving house – a countdown to move day

Moving house is really exciting, but it can also be quite a stressful experience if you’re not prepared.

We’ve put together a list of things you need to do before the big day arrives! Tick these off and you should be all set for a smooth move:

  • Cancel or move existing bills/contracts
  • Redirect your mail
  • Arrange removals and pack
  • Let people know!
  • Get your new home ready

Cancel or move existing bills/contracts

You’ll have a handful of bills attached to the house you’re leaving and you’ll need to get these settled or moved to your new property to make sure you don’t pay for a service you aren’t using. You may need to cancel/move:

  • Utility bills (gas, electricity and water)
  • Landline, TV and internet bills
  • Council Tax
  • Any insurances on the house
  • TV Licence

You’ll need to bear in mind that some companies may charge admin fees if you change your details and your Council Tax could increase or decrease if you move into a different tax band area.

Redirect your mail

If you haven’t arranged for all of your bills, statements, subscriptions and letters to be sent to your new address, you may want to take advantage of Royal Mail’s post forwarding service.

This service will redirect your mail to any UK or overseas address for 3, 6 or 12 months from just £33.99 for each different surname. This may be ideal if you regularly receive mail, so your post reaches you sooner.

Arrange removals and pack

If you are not moving your possessions yourself, you may want to book a removal firm and get them ready to help you move. Do this in advance and take the worry away when moving day comes around. You may also want to book the day off for moving house, so check with your employer if you can!

To get ready for moving day, pack away the things you don’t need first and label the boxes so they are easier to unpack. You may be wise to disassemble large furniture in advance and have it ready downstairs so it can be moved easier. Be sure to take care of delicate items – plenty of bubble wrap may be needed!

Let people know!

Certain people will want to know you have moved house as they will need to update their records. These can include your:

  • Doctor
  • Dentist
  • Vet
  • Bank
  • Employer
  • School

If you have a good relationship with the neighbours you are leaving behind, it may be a good idea to let them know where you are moving to, so they can keep an eye on whether anything is delivered to your old address once you’ve left.

Get your new home ready

There’s nothing worse than getting to your new home and finding it’s dirty but you can be prepared for this. Before you unpack, clean your cupboards out and wipe down surfaces, so your nicely-packed cutlery, crockery and cookware is ready to store away.

Lastly, for a happy moving day take the kettle to your new home on the first trip. There may be plenty of tea and coffee drunk throughout your moving day!

Thinking of moving? Get ready now! Speak to Clever Mortgages now to discuss your mortgage and protection needs – Enquire.