Residential & Buy To Let Mortgages

Residential Vs Buy To Let

  • A residential mortgage is a loan that is secured against a property that you are buying or renovating. It is an agreement between you and a lender and is typically used to purchase a home. The amount you borrow is based on the valuation of the property, your credit score, your income, and your debt-to-income ratio. Generally, the more equity you have in the property, the better the terms of the loan. There are a variety of different residential mortgage products to choose from, such as fixed-rate mortgages, tracker mortgages, variable mortgages and offset mortgages.

  • Buy to let is an opportunity to invest in property. It involves buying a property specifically to rent out, either to a single tenant or multiple tenants. The aim of buy to let is to generate an income, either through rental payments or capital appreciation. Generally, it is considered a long-term investment, as it takes time to make a profit. There are several key considerations to bear in mind when investing in buy to let. Firstly, there are the costs associated with purchasing a property, such as stamp duty, legal fees and survey costs. Secondly, there is the time and effort needed to source a suitable tenant, manage the tenancy agreement and maintain the property. Thirdly, the rental income and capital appreciation of the property must be considered. Finally, tax issues must be taken into account, as rental income is taxable. Overall, buy to let is a great way to invest in property, but it is important to understand the risks involved and take the necessary steps to protect your investment.

Remortgage

Most clients will take out a mortgage with a fixed tie in period of 2, 3 or 5 years. Once, this period comes to an end, clients will find the bank will revert the rate onto a Standard Variable Rate (SVR) which will be higher than the initial fixed period for the remaining term of the mortgage. Levana Finance can assist you in avoiding going onto the SVR by researching the market and advise you the most suitable deal for you.

Why would you re-mortgage?

  • Finding a better deal

  • To Reduce the Mortgage Term

  • Capital Raising:

  • To purchase another property

  • To debt consolidate

  • To make Home Improvements

Shared Ownership

Shared ownership is an affordable way to buy a home. It is a type of home ownership where you buy a share of a property, usually between 25% and 75%, and pay rent on the remaining share. You then have the option to buy more shares of the property until you own it outright.

Shared ownership is a great way to get on the property ladder if you cannot afford to buy a property outright. It can also help you to reduce your housing costs, as you will only be responsible for the share of the property that you own.

Shared ownership can be a great option for those who have difficulty obtaining a mortgage or who cannot afford a large deposit. It can also help to reduce the amount of rent you have to pay each month, as you are only responsible for the part of the property that you own.

Shared ownership can also be a great way to get into the property market without having to wait for years to save up enough money for a deposit.

Help to Buy

Help to Buy Self Build UK is a government scheme that helps prospective self-builders across the country to achieve their self-build dream. The scheme was launched in 2017 and has already helped many people to build their homes. Self-building is a hugely rewarding experience and with the help of the scheme, it is now easier than ever to get started. Help to Buy Self Build UK offers financial assistance in the form of an equity loan, which can be used to purchase land, cover the cost of building materials and labour, and other associated costs. The loan is interest free for the first five years and can be repaid at any time without penalty. The government also offers advice and guidance on all aspects of self-build, from the initial planning stages, right through to completion. The scheme is open to anyone over 18 and is not restricted to first-time buyers. There are a number of criteria that need to be met in order to qualify for the scheme, but with the help of Help to Buy Self Build UK, the dream of building your own home is closer than ever.

The old Help to Buy that was not Self Build, is no longer available.

First Time Buyers

As a first time home buyer, the process can be both exciting and intimidating. There's a lot to consider when making such a large purchase, and it's important to do your research before you start. Start by getting pre-approved for a mortgage, so you know what you can afford. Then, visit open houses and look for a home that fits your budget and meets your needs. When you find a home you're interested in, make an offer. Have a valuation done to make sure everything is in good condition and the bank is happy to lend. Owning a home can be a rewarding experience, but it also comes with a lot of responsibility.

As a first time buyer, it's important to be prepared and understand the process that is why Levana Finance holds your hand all the way through the process - to when you get the key and beyond!

Right To Buy

Eligible Council and Housing Association Tenants in England are able to purchase their home with a discount of up to a maximum 70% or £108,000 in London or £80,900 outside London, whichever is lower. The amount of discount you are eligible for is determined by how long you have been a public-sector tenant.

For a House
You are eligible for 35% if you have been a public-sector tenant for 3 years and anything over 5 years, is increased by 1% for every year up to the maximum indicated above.

For a Flat
You are eligible for 50% discount based on being a public-sector tenant for 3 years and anything above 5 years is increased by 2% for every extra year up to the maximum indicated above.

Levana Finance can help you work out the discount available and guide you through the process of how much you will be able to afford, how much you need to put down as a deposit and help you gain ownership of the property.

Bad Credit Mortgages

Having bad credit can make it difficult to secure a mortgage. It can be especially difficult if you have a low credit score, as many lenders will not be willing to lend to you. This is because they view you as a higher risk borrower, as you may not be able to make the required payments. The good news is that even if you have bad credit, there are still lenders who are willing to work with you. These lenders may require a higher down payment, as well as more stringent terms and conditions. Additionally, they may require that you pay a higher interest rate, as they are taking on more risk.

 If you are someone that has a Poor Credit Score due to the following:

  • Late Payment/Arrears

  • Defaults

  • County Court Judgments

  • or Bankruptcy

You may think you are unable to obtain a mortgage but there are specialist lenders that can potentially lend based on what level of bad credit you have, for a higher rate than competitive high street banks would lend. Although some lenders will require you to pass their internal credit check, others' can manually assess the case depending on how long ago the bad credit occurred and what was the monetary value of it.

Contractors

Contractors are usually deemed as a high risk for Lenders due to only being employed when needed, the short notice period when required and also being paid for the hours they work. Although, Contractors and Freelancers enjoy the perks of working flexible hours they can have their income fluctuate over the years. The main industries that usually employ people on a contractor basis are IT, Oil, Law and Financial Services.

Lenders usually require Contractors and Freelancers to have at least 12 months history if not a couple of years, so they can see that they have been financially stable. The lenders will also require a minimum amount of months remaining on their current contract and potentially a renewable being available.

If you are on a "Day Rate" contract then Lenders will look at your daily rate and multiply this by a number of days in the week you usually work and then multiply this further by 46-48 weeks. If you are a contractor that's set up as Self Employed then the average of the last 2-3 years will be needed.

Expat Mortgages

If your a person that is temporarily or permanently residing in a country other than the UK, you will be referred to as an Expatriate or "Expat". Therefore, although you may be British but working abroad, lenders are quiet reluctant to lend and if they do, they have a stricter criteria.

There are two types of Expats.

  • Those who are looking to move abroad and would like to rent out and keep the property 

  • Those that are looking to purchase a new home as they are returning back to the UK

One issue that can arise from being an Expat is that you may not be getting paid in Sterling which would mean finding a lender that also accepts Foreign Income also.

Levana Finance has a range of specialist banks and smaller Building Society's that offer Expat Mortgages at competitive rates and can guide you through the process of which countries are acceptable and what deposit level you will need.

 

 

Foreign Nationals

In order to secure a mortgage in the UK, lenders require you to hold a British Passport or at least have indefinite leave to remain. Without these, a lender can simply say no. Other lenders can accept Foreign Nationals on a visa but will lend depending on how long you have been a resident in the country and how long you have left for the visa to expire.

It is possible for foreign nationals to get a mortgage in the UK, with some lenders offering specialised products to meet the needs of foreign nationals. These products usually require a higher deposit than a normal mortgage, but they can be beneficial for those who have a good credit history and a steady income. Foreign currency depending on the country can also be accepted on a case by case scenerio.