01787 860 770 or 01206 430 770 info@trustfinancialsolutions.co.uk

Mortgages

There are various different types of mortgages depending on what kind of property you wish to purchase and your personal financial circumstances. This page explains the different types of mortgages and what kind of buyer they are best suited to.

 

Call us on 01787 860 770 or 01206 430 770 if you would like to have an informal, no-obligation chat about your mortgage requirements.

Fast, Friendly Mortgage Advisers

What is a Mortgage?

A mortgage is a loan which is secured against your property and is a legally binding contract in which you agree to repay the amount you borrow plus interest over a set period of time. Mortgage terms can be anything up to 40 years.

There are different types of mortgages available including repayment, interest only, self-build and buy to let.

How do I get a mortgage?

Before you start looking for a new home you need to know how much you can borrow and what your total budget is. You will need to have saved a deposit – starting from 5%, the more the better, of the amount you are buying, plus have enough left over to cover legal fees, stamp duty, surveyor costs and mortgage arrangement fees.

When we have determined how much you need to borrow and your future plans and requirements, it’s time to research the different mortgages available to you and the interest rates on offer. Once you have found a home and had an offer accepted, contact a mortgage adviser at Trust Financial Solutions to help you get a suitable and competitively priced deal.

Here at Trust Financial Solutions we offer a confidential and personalised service that will guide you through the process of finding and securing the best mortgage for your needs. When you complete your application you will need to provide evidence of your identity, income and address. Your lender may also require a reference from a previous lender, employer or landlord.

Generic Mortgage Types

Offset Mortgages

An offset mortgage allows you to offset your savings against the sum you have borrowed on your mortgage and you will be charged interest on the balance. It is usual for interest to be charged on a daily basis and may allow you to pay off your mortgage faster than with a conventional mortgage and may save you money in the long run.

Tracker Mortgages

The Tracker Rate Mortgage follows a particular base rate such as the Bank of England Base rate or LIBOR (London Interbank Offered Rate) and can decrease or increase accordingly.

Fixed Mortgages

With a Fixed Rate Mortgage, the rate stays the same throughout the specific period, thus giving you peace of mind that your monthly payments won’t change.

This allows you to budget accordingly

SVR (Standard Variable Rate) Mortgages

This is the Banks own lending rate without any discounts or deals. Usually this rate provides you with total flexibility and no penalties for closing the account early.

Specific Mortgage Types

Trust Financial Solutions - Mortgage Advisers in Sudbury and ColchesterThis is when you are buying a new home or moving to a different home and need to sell your existing house, either privately or through an estate agent.Before you start looking at buying your new home there are a few things you have to put in order. I’ve listed them to keep it simple for you.

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Also known as a Capital and repayment mortgage, this is the only mortgage that guarantees your mortgage will be completely cleared at the end of the term providing you keep up to date with all the required mortgage payments.

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This is a mortgage where only the monthly payments cover the interest on the mortgage.

The loan is not decreased and at the end of the specific period the capital still remains and you will have to pay off this loan in full.

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Re-mortgaging, also known as refinancing, involves paying off one mortgage with the money from a new mortgage with a different lender. People remortgage for a variety of reasons including the need to secure lower monthly repayments, to consolidate debts or to raise capital.

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Buying your first home is a huge achievement and a momentous life milestone. Not only are you taking your first step onto the property ladder and breaking free from the shackles of renting, or leaving home, you are making a long-term financial commitment that you are tied into for years to come.

Find Out More

This is required when you wish or need to borrow additional money, for example to build an extension to your home, modernise your kitchen or bathroom, or to consolidate your existing debt etc.

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This is designed to incorporate all of your debt onto your property. There are various risks attached to this type of solution.
This is when you wish or need to borrow additional money to consolidate your debt such as credit cards, store cards, overdraft, loans and HP.

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Let to buy is a situation where a homeowner wishes to purchase a new home to live in and rent their existing property out to tenants. This would mean changing your existing residential mortgage to a new buy to let mortgage.

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Buy to Let Mortgages are aimed at those seeking to purchase a property to rent out. With lower interest rates and stagnant property prices, buy to let has become a popular option for investment and income generation. The lending criteria for buy to let mortgages is strict, though varies between lenders.

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This is a type of mortgage available for you to build your own home. Plans will need to be passed, together with a full budget for the project before the mortgage application proceeds.

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These are used for buying or re-mortgaging your commercial property.

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Let us take away the pain…

We provide our clients with truly expert mortgage advice. Our staff members are trained to provide the customer service levels you would expect from professional advisers. Take advantage of our no-jargon approach and contact us today to discuss your mortgage (and insurance) requirements.

House Purchase Mortgages

This is when you are buying a new home or moving to a different home and need to sell your existing house, either privately or through an estate agent.

Before you start looking at buying your new home there are a few things you have to put in order that are listed below for you.

1. Before you start looking for a new home you need to know how much you can borrow and what your total budget is. Online mortgage repayment calculators can be a very useful tool in determining this. You will need to have saved enough money for a deposit before making a mortgage application, in addition, you will need to cover further costs e.g legal fees, stamp duty, surveyor costs and mortgage arrangement fees.

2. Current mortgage amount
Find a copy of your existing mortgage offer and call the lender and ask them for your outstanding balance. This will give you an idea of how much your existing mortgage is and how much equity is in your current home.

3. How much can you borrow?
Then you will need to work out approximately how much you can borrow.

4. Contact a professional mortgage adviser
Here at Trust Financial Solutions, we offer a confidential and personalised service that will guide you through the process of finding and securing a suitable mortgage for your needs. We will run through your income and outgoings and work out how much you can borrow. Also, we can request a mortgage agreement in principle from a lender for you. This will involve you being credit checked.

Should you need help or understanding about these different types of mortgages, please speak to a Trust Financial Solutions mortgage adviser who can provide you with advice, help and reassurance on which mortgage is right for you.

We aim simply to give you the ability to buy your home with peace of mind and to live the lifestyle of your choice.

5. Put your house on the market and wait for an offer to be made

Costs involved with buying and selling:

Stamp Duty Land Tax
Solicitor fees
Lenders Arrangement fees
Valuation fees
Broker fees
Estate agent selling fees
Removal fees

6. Search for a new home
Once you’ve had an offer on your home you can start looking for another home. Now that you have everything in place, you’ve found a new home; you can place your offer.

7. Once your offer has been accepted, Trust Financial Solutions can place a mortgage application with a lender available to us that suits your circumstances. Then your application is processed by a mortgage underwriter and you will need to provide evidence of your identity, income and address and any other documents they may require; a valuation is then instructed.

When all this is satisfactory, the mortgage will be offered. We can make any final adjustments to the mortgage requirements and then place a mortgage application for you.

8. Solicitors
The solicitors are instructed and the legal conveyance work is carried out. Once all parties are happy the properties are exchanged and then completion can take place, .usually between 1 and 4 weeks after exchange of contracts.

*Note – The Financial Conduct Authority does not regulate conveyancing services.

9. Keys
You now get your keys to your new home and can open the bottle of champagne! The whole process usually takes about 3 months.

Should you need help understanding these different mortgages, please call Trust Financial Solutions on 01787 860 770 or 01206 430 770 and speak to one of our friendly mortgage advisers who will provide you with expert advice, help and reassurance on which mortgage is right for you. We simply aim to give you the ability to buy your home with peace of mind and to live the lifestyle of your choice.

Trust Financial Solutions can assist you in finding the right mortgage for you

We offer a confidential one-on-one service that can take the guesswork out of mortgages and help to guide you through the process from start to finish. This is what we do best and we look after you every step of the way.

We match your personal situation and objectives with the most appropriate mortgage deals available from our panel of mortgage lenders.

We will request from you all the necessary paperwork at the start.

We work closely & meticulously with mortgage companies to ensure the application is processed promptly, guiding you through every step of the way from first contact to completion.

We take pride in working to meet your timescales.

At Trust Financial Solutions we strive to be professional, courteous, prompt, trustworthy, honest, caring, but most importantly, we’ll always have the best interests of you, the client, at heart.

Repayment Mortgage

This is also known as a Capital and repayment mortgage. This is the only mortgage that guarantees your mortgage will be completely cleared at the end of the term providing you keep up to date with all the required mortgage payments. Each monthly payment comprises part interest, and part return of capital.

Interest Only Mortgage

This is a mortgage where the monthly payments only cover the interest on the mortgage.

The loan is not decreased and at the end of the specific period the capital still remains and you will have to pay off this loan in full. In order to do this, you will need an investment* to cover the outstanding amount, (savings). The sale of your home is currently not allowed to pay off the loan.

To speak to one of our mortgage advisers about a repayment mortgage call:
01787 860 770 or 01206 430 770

*Please note that we are unable to provide any advice in respect of a suitable repayment vehicle.

Remortgages

Re-mortgaging, also known as refinancing, involves paying off one mortgage with the money from a new mortgage with a different lender. People remortgage for a variety of reasons including the need to secure lower monthly repayments, to consolidate debts or to raise capital. By re-mortgaging, you may secure a better deal and lower monthly repayments than if you continue your mortgage with your current lender.

When do I re-mortgage?

Your current mortgage is likely to have provided a specific rate for a specified period of time, and either you are about to reach the end of this period, or you already have. It is common for a mortgage to revert to the lender’s ‘standard variable rate’ after the initial deal, and you may now wish to review what other options are available to you, as well as any offered by your current lender.

How do I re-mortgage?

If you’re looking to remortgage your home there is a lot that needs to be taken into careful consideration before making your decision. It is worth checking whether your existing lender can offer you any options. Your monthly budget is key to whether or not re-mortgaging is right for you. Some lenders may offer no arrangement or booking fees, a free valuation on your home and free conveyancing work. Some lenders may offer a lower headline interest rate but may charge fees.

If you have decided to remortgage your home, you need to start preparing a few months before you intend to make the switch to a new lender. Your latest mortgage and bank statements will show how much you are paying for your current mortgage. Depending on the type of mortgage you have, the cost of your repayments might have fallen – take this into consideration when deciding how much you can afford to pay on a monthly basis. It is important to speak with your lender to request a quote for the total cost of paying off your loan as this might affect your financial capability to remortgage. Once you have done this, it’s time to find a new mortgage. You should also check with your current lender whether they can offer you any new products. Once you have done this it is time to see what other mortgages may be available, and whether it is worth switching to a new lender.

First Time Buyer Mortgages

Buying your first home is a huge achievement and a momentous life milestone. Not only are you taking your first step onto the property ladder and breaking free from the shackles of renting, or leaving home, you are making a long-term financial commitment that you are tied into for years to come.

Being a first-time buyer need not be a frightening or an overwhelming experience. You can get a mortgage with a deposit as small as 5%.

What competitive mortgage deals are suitable for your needs as first-time buyers?

Banks and building societies are constantly changing and evolving the financial products they offer, and mortgages and first-time buyer mortgage rates change frequently.

If you want to find competitive mortgage deals suitable for your needs as first-time buyer, it is advisable to speak with a mortgage adviser.

Here, at Trust Financial Solutions we are fully trained and qualified to help you figure out where you stand financially, what help you can get buying your first home and what first-time buyer mortgages are available. There are various government-backed schemes available for first-time buyers such as First Buy Scheme, Newbuy, Shared equity, as well as a guarantor mortgage.

Further Borrowing

This is required when you wish or need to borrow additional money, for example, to build an extension to your home, modernise your kitchen or bathroom, or to consolidate your existing debt etc.

In order to raise additional money, you must have equity in your current home together with your income being adequate to make it affordable to borrow the additional money.

Three main ways to raise additional money

There are 3 main ways of raising additional capital – with your existing lender directly, a secured loan with a different lender, or a remortgage, the first two options being possible without redeeming your existing mortgage. There are other ways of raising additional money, so this isn’t an exhaustive list, just examples of the 3 main ways.

*Note – Depending on which type of further borrowing you decide on, there may be a charge for this service.

Should you have a need for a secured loan you will be referred to a third party provider. Neither Trust Financial Solutions nor First Complete Ltd accepts responsibility for any advice supplied by the third party.

Debt Consolidation

This is designed to incorporate all of your debt onto your property. There are various risks attached to this type of solution.

This is when you wish or need to borrow additional money to consolidate your debt such as credit cards, store cards, overdraft, loans and HP.

Three main ways to consolidate your debt.

There are 3 main ways of consolidating your debt – with your existing lender directly, a secured loan with a different lender, or a remortgage, the first two options being possible without redeeming your existing mortgage. There are other ways of raising additional money, so this isn’t an exhaustive list, just examples of the 3 main ways.

In order to carry out this type of process, you must have equity in your current home together with your income being affordable to borrow the additional money.

This can be a suitable way to bring all of your debt under one roof and keep your outgoings to a minimal because you are reducing the individual interests on each credit card or loan to a more manageable and affordable rate. Please be aware that placing your debts under one roof for a short term may result in a lower interest rate being charged, but then this needs to be balanced against the fact that overall this may increase the term over which the debts are paid and thus increase the total amount payable.

There are risks attached to putting all your eggs into one basket, as now all of your debt is secured against your home and if you miss your repayments on the mortgage you could inevitably lose your home.

*Note – Depending on which type of debt consolidation you decide on, there may be a charge for this service.

Should you have a need for a secured loan you will be referred to a third party provider. Neither Trust Financial Solutions nor First Complete Ltd accepts responsibility for any advice supplied by the third party.

Let To Buy

Let to buy is a situation where a homeowner wishes to purchase a new home to live in and rent their existing property out to tenants. This would mean changing your existing residential mortgage to a new buy to let mortgage.

With the credit crunch bringing a decline to house prices, buying to let has become a popular option for those seeking to upgrade their home without selling their current home at a lower value. It is also an option for those who have a strong attachment to their home and do not wish to sell but need to move on.

Trust Financial Solutions can help take the confusion out of the let to buy process.

Buying To Let* might be worth considering if you would like to build a portfolio of investment properties or if you would like to move but have found you have little or no equity in your current home. In order to do this, you will need to change your current residential mortgage to a Buy To Let mortgage. Essentially, Buying To Let* allows you to wait until the housing market increases in momentum, hence gaining more profit if you do eventually choose to sell. If you let out your home with an existing mortgage on, you will need “consent to let” from your existing lender.

‘Let to buy’ should not be confused with ‘buy to let’

A Buy To Let* Mortgage is required to purchase a new home which is then rented out.

A Let To Buy Mortgage is required if you wish to rent out your current home in order to raise capital to purchase a new residential property.

We have access to a panel of mortgage lenders representative of the whole of market and therefore can look at a range of options for you. Because of the minefield of information out there, finding reliable information and advice on let to buy mortgages can be a very frustrating process.

Buy To Let Mortgages

Buy to Let Mortgages are aimed at those seeking to purchase a property to rent out. With lower interest rates and stagnant property prices, buy to let has become a popular option for investment and income generation. The lending criteria for buy to let mortgages is strict, though varies between lenders. Most lenders require a minimum 25% deposit, so it goes without saying that you will need to have a large sum of cash at the ready before being able to enter the buy to let market.

Is Buy to Let right for you?

Before filling out an application for a buy to let mortgage, it’s very important to assess the market and ensure that not only are you signing up for the product that is right for you, but that you are confident that buying to let is for you.

Consider whether buy to let is the arena in which your investment will best perform and bear in mind that property values can both rise and fall. Different lenders will offer products that vary in their criteria, interest rates, features and conditions and it’s worth taking the time to research each possible buy to let mortgage option. Research your target tenant market, the locality in which you are considering purchasing a house.

Can you afford to buy a buy to let mortgage?

Before engaging in any buy to let mortgage contract, it is absolutely essential that you are certain a buy to let type mortgage fits within your financial capabilities. Find out about repayments and interest rates, factor these into your calculations, leaving yourself some leeway for future rate rises. Plan for every eventuality – what if your property sits empty for several months? What about basic maintenance and repairs that, as a landlord, you will be obliged to take care of? Lenders will usually assess the loan on the basis of rental income being more than sufficient to meet the mortgage by a certain margin, rather than assessing on earned income, although many do require a minimum level of earned income.

*Note – In general, Buy to Let Mortgages are not regulated by the Financial Conduct Authority

Buy To Let Remortgages

Buy to Let remortgages are aimed at those who already have a buy to let property rented out. With stagnant property prices and falling interest rates, buy to let has become a popular option for investment and income generation.

The lending criteria for buy to let mortgages is strict, though varies between lenders. Most lenders require an equity amount of a minimum 25%.

Most lenders like to have proof of income, but this is not always required. Also most lenders need the rental payments to cover the mortgage payments by 125% to 145%.

*Note – In general, Buy to Let Remortgages are not regulated by the Financial Conduct Authority.

Self-Build Mortgages

This is a type of mortgage available for you to build your own home. Plans will need to be passed, together with a full budget for the project before the mortgage application proceeds.

Once the mortgage has been approved the money is released in stages during the building process and valuations are done at each stage you wish to receive your money.

This way it prevents you spending too much money too soon and running over your budget. As you are not buying the property you do not have to pay any Stamp Duty Land Tax at any stage during the build or at completion. However, if you buy the land for more than £125,000* then you will pay Stamp Duty Land Tax on this purchase.

* Under current legislation at 01-07-2018 – Data Source: HM Revenue & Customs

Commercial Mortgages

These are used for buying or re-mortgaging your commercial property.

Should you have a need for a commercial mortgage you will be referred to a third party provider. Neither Trust Financial Solutions nor First Complete Ltd accept responsibility for any advice supplied by the third party. Depending on which type of commercial mortgage you decide on, there may be a charge for this service, however, Trust Financial Solutions will not charge you a fee for this service.

Request Your Initial Mortgage Consultation Today!

Should you need help or understanding about these different mortgages, please call Trust Financial Solutions for expert advice and help and reassurance on which one is right for you. We simply aim to give you the ability to buy your home with peace of mind and to live the lifestyle of your choice.

Trust Financial Solutions can assist you in finding the right mortgage for you. We offer a confidential one-on-one service that can take the guesswork out of mortgages and help to guide you through the process from start to finish. This is what we do best and we look after you every step of the way.

We match your personal situation and objectives with the most appropriate mortgage deals available from our panel of mortgage lenders.

We will request from you all the necessary paperwork at the start.

We work closely & meticulously with mortgage companies to ensure the application is processed promptly, guiding you through every step of the way from first contact to completion.

We take pride in working to meet your timescales.

At Trust Financial Solutions we strive to be professional, courteous, prompt, trustworthy, honest, caring, but most importantly, we’ll always have the best interests of you, the client, at heart.

Disclaimer - Note:
YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE
We will charge a broker fee of between £299 and £499, payable on application. The amount we will charge is dependent on the amount of research and administration that is required.