Solumtoya:
Time for UK Mortgage thread

Ogbaba123:
... please what are the pros and cons of an interest only mortgage? I have read about these difference but still not sure why any of the options should be picked over the other. Please can someone explain further the advantages and disadvantages of the different kinds of mortgage payments. Cheers!

dupyshoo:
With interest only mortgage, let's say your mortgage is £100k, you will only be paying the interest and the capital will not reduce. So, the amount you will be paying monthly will be very small, say about £100 monthly depending on the interest rate. At the end of the mortgage tenure, you either sell the house to pay the mortgage lender the £100k or take it from your savings.
Whereas, with repayment mortgage, you will be paying more every month as you are not just paying the interest on the loan but you are repaying back the loan, so you might be paying about £500 per month. At the end of the mortgage tenure, you will have finished paying the £100k, so you wont have to pay the bank any more money.
Tbh, I am not sure you will get any lender to give you interest only mortgage anymore. It's only those doing buy-to let that lenders give interest only mortgage to.

Ticha:
Avoid interest only mortgages unless you're earning money from that house. That is the only time there is a pro for interest only because the repayments are lower and therefore makes your cash flow better. Actually, another pro will be if you already have the money and want to invest it, of course if you lose that money then you'll lose your home come crunch time.

For a property you live in, capital repayments all the way. It pays down the over all loan over the duration of the mortgage and the house belongs to you wholly when paid off. Of course, over the lifetime of the mortgage you can also borrow some of that capital back for other purposes which you often can't do with an interest only mortgage because the equity doesn't stack up as much.

If you take a loan of 75k and pay interest on it for 5,10, 15 years. At the end of that time, you still owe 75k which must be paid or you lose your home.

Lexusgs430:
Interest free mortgage, would eventually become a very nasty trap (if that's the only property you own)........
Repayment mortgage is the best, you're paying the interest + capital........

Let me explain Interest only mortgage to you, in the simplest form ......
- You buy a £200,000 property, mortgage term is 25 years........
- The interest on the mortgage is £70K............. In 25 years, you would have only paid back £70K.......
- At the time of maturity, you must pay your lender the balance of £200K ........

If you're now semi retired, and lucky enough to have £200K, under your pillow (goodluck).......
If you don't ...... You don buy wàhálà......... ;Dv

Goldie10:
... For those who have gone the route of purchasing their first property after moving to the UK, please I have some questions:
- Did you have to wait for atleast 2 years before purchasing?
- How did you go about finding a mortgage broker that was not asking for 25% deposit (this seems to be the norm for those of us without up to 2years residency in the UK)
- Now that Help to buy is over - what other options are available for first time buyers aside LISA that has a cap of £450k on property value?
Recommendations for brokers who have experience with immigrants witout ILR will be appreciated. We really need a guide o for newbies here please

Zahra29:
If you're a cash buyer then it's very possible. If you need a mortgage then it would depend on several factors such as the type of visa you are on- work, spousal etc and your circumstances e.g. how long you have lived in the UK. If you're married to a British national or settled status, then it might be easier because of their permanent status. However most lenders will require minimum 25% deposit and may have further conditions such as a minimum length of UK residence and time left on the visa

Zahra29:
This is the norm where the applicant, or for joint applications - either or both applicants, do not have at least ILR or settled status. Halifax is one of the few lenders who might make exceptions in certain circumstances such as if the applicant(s) have lived in the UK for over 5 years and/or have earnings over £100k

semmyk:
[PROPERTY INVESTMENT]
... ...
There are 4 types of Individual Savings Accounts (ISA):
- cash ISA
- stocks and shares ISA
- innovative finance ISA
- Lifetime ISA

NB: NS&I (National Savings and Investments), a state-owned savings bank in the UK, offers Premium Bonds and a range of other savings and investments, including Direct Saver.
NS&I is a non-ministerial department.

Ticha:
If you're under 39 years old, open a LISA account. Start paring down your expenditures. You can also round up your spends and save the spare change to the nearest pound. Sell anything you have that hasn't been used for 6 months or more - cos the chances of then using it again is quite low. Get a 2nd job if you have the time (do not sacrifice family time as you'll never get that time back) and save every penny from that 2nd job. Consider saving a fixed monthly amount as well.
Remember unless you're rolling in wealth, your first home is just a stepping stone into property ownership. Be realistic as to what you can buy. Good luck!

semmyk:
[PROPERTY INVESTMENT]

Gemma11:
My advice is to get yourself in the system and build up a credit profile asap as soon as you arrive in the country. It is ok to do cash in hand but having a job which is subject to tax and NI is important as well. Once you get a job, get a credit card to use and pay off regularly in (don't miss any payments) to build up your credit score so when it comes to applying for a mortgage you will be in good stead. A contract phone is also another way...just make sure you pay on time each month. Good idea to set up standing orders or direct debits so you don't miss anything. In this fast UK lifestyle it is very easy to forget to pay something so it is best to automate key payments.

If you are under 30 and intend to buy then do so asap as you are more likely to get a 35 year mortgage. Don't be put of by the number of yeats because anyhouse bought today is not going to increase in value. The UK is an Island and only around 10% of the land is built on and so there is always going to be high demand for properties.

Look into schemes that the UK Govt has to help first time buyers like LISA where you get £1k free each year for every £4 saved to help you build up a deposit. You and your partner can both open LISA accounts and get up to £1k free each every year which can be combined to make your deposit

Many may not be too comfortable about the advice below but here is what I did..
... ...
Buy properties in high rent locations like near key stations, universities, amenities ect.
....
Oh yeah and once a house increases in equity, remortage if you can take out the money and use it as a deposit on another house..that's if your intent is to build a property portfolio.

Another tip, always overpay your monthly mortgage if you can as it reduces the interest.

hustla:
So, after all the gbas gbos, how did you go about getting properties in seemingly expensive areas? Hurdles of BTL, tenants, etc
Let us learn

Ticha:
Help to buy as a whole closes in Oct 2022. It's altogether possible that it has closed in some areas. The help to buy ISA is closed. The help to buy equity loan scheme is still open till Oct.

https://www.gov.uk/help-to-buy-equity-loan

Ticha:
I am buying as long as the deal stacks up! No one is creating more land. My tenant vetting processes have always been robust and we aim for tenants that any black mark on their credit would be abhorrent to them. The one 'bad' tenant we had paid rent throughout even with her skoin skoin.

Scotland has a rent increase and eviction ban in place till March 2023 at least. England is currently in consultations over a rental cap. Wales has stringent regulations in place. If you are aware of all the regulations and potential pitfalls, it's easier to manage. Property is like running any other business. Enter with a solid strategy and arm yourself with knowledge.

Ticha:
Pension and wealth planning for the future - very long read..
... ...
... ...
This is not financial advice. Just sharing what we have done.

Ticha:
The earlier you start the better. Usually the biggest obstacle is the deposit so once you have that, Bob's (We need a 9ja name) is your uncle.
...

Ticha:
... ...
Flats are a good first step onto the property ladder. Plus it's easy to resell especially in Bristol to other FTB when you trade up. PS - Ex council flats are also very good in the right location. They have heaps and heaps of space and hold their prices very well
... ...

Ticha:
... ...
Recycling cash out of property is the way to go however it pays to know exactly what you're letting yourself in for. Buy right and hold. Property is a long term game. You buy and sit on it and you make the gains. We haven't had to front up a cash deposit in a long time.

You want to go into property? Ignore all those property gurus on YouTube.
Do not pay for any training courses!
- Join a PIN (Property Investor Network) group in your area - they usually meet monthly and network.
- Join Property Tribes.
There are some useful UK property groups on FB.
- Get clued up on financing property.
- Find a very good broker and lastly, have a source of income no matter how little.

Property goes through lean and good times ...
... ...

Ticha:

It's called property Log. Link below
Google chrome... ...

semmyk:
Towing the line of -screenshoting' as admonished by @Lexusgs430
Discourse on freehold and leasehold around page 359
...
For completeness, from the closed old thread
Page 84 by Lexusgs430: www.nairaland.com/4158866/living-uk-life-uk-immigrant/83#73329511

Page 708 by Ticha:

Pearlyfaze:
Our Ticha and other Ancestors, Please how long do one need to be in the YouKay before he/she can start looking for/start Engaging Mortgage Advisors in order to enter property ladder.
...

semmyk:


There's been numerous call in the Living in the UK thread (www.nairaland.com/6719932/living-uk-life-immigrant-part-2/) for a #mortgage thread.
This thread aims to achieve that. Posts here are about AND must be about Mortgage related issues in the UK.
Clarity around housing (the house, structure of the house, rules around housing ...) are welcomed, including those of rental. However, request for rental availability or how to rent ARE NOT ALLOWED! Do not post them here.

Over the lifetime of this thread, key terms will be added.
Sit back, keep calm and enjoy the mortgage-sourcing

[Key Terms] To be populated over time
Bond:
Mortgage:
Lender:
Solicitor:
Mortgage Broker:

EPC Rating:
Council Tax:
Buy2Let:
Primary Residence:
Boarder:
Free loader:
S24:
Ownership Structuring:

____________________
@justwise @Ticha @Fatima04 @Solumtoya ...

semmyk:
Towing the line of 'screenshotting' as admonished by @Lexusgs430
Discourse on freehold and leasehold around page 359 - Re: Living In The Uk-life Of An Immigrant (part 2)

semmyk:
... ...
Just pointing to the following:
[1] Source www.gov.uk/leasehold-property
You only own a leasehold property for a fixed period of time. (different from freehold or technically 999yrs lease)
Ownership of the property returns to the landlord when the lease comes to an end.
[2] Source https://hoa.org.uk/advice/guides-for-homeowners/i-am-buying/leasehold-v-freehold-whats-the-difference
There are two fundamentally different forms of legal ownership: freehold and leasehold. Although estate agents tend to gloss over it, it can be the difference between a home that is worth buying and one that isn’t. ...

Lexusgs430:

Ticha:

Lexusgs430:
Welcome to the United Kingdom's mortgage regime...... Better grab the mortgage, make your 25 years start to count .......
NB : Ensure you fully understand the difference between, freehold vs leasehold properties........

tshoboy:
Barclays can also do 90% LTV, but you should have stayed in the UK for three years and be on a work visa (or similar visa that has long term residency). Moneybox has a free brokerage service. You can chat them up and they will advise you based on your situation.

Goldie10:
Hello All,
For those who have gone the route of purchasing their first property after moving to the UK, please I have some questions:
- Did you have to wait for atleast 2 years before purchasing?
- How did you go about finding a mortgage broker that was not asking for 25% deposit (this seems to be the norm for those of us without up to 2years residency in the UK)
- Now that Help to buy is over - what other options are available for first time buyers aside LISA that has a cap of £450k on property value?
Recommendations for brokers who have experience with immigrants witout ILR will be appreciated. We really need a guide o for newbies here please

kwakudtraveller:
Has anyone here been successful in buying a house with their student visa or dependent visa? With the amount I'm paying for rent, I think it's better to just buy a two bedroom apartment but I don't know how to go about it. If you have, the please help a brother out with some information.

semmyk:
Cross post from Living in the UK thread

tshoboy:

Barclays can also do 90% LTV, but you should have stayed in the UK for three years and be on a work visa (or similar visa that has long term residency). Moneybox has a free brokerage service. You can chat them up and they will advise you based on your situation.

Regex:


Do I need to own an account at Barclays? I am on a work visa (5yrs), I have lived in the UK for 2yrs. How do I go about this?

dupyshoo:
Don't think so. Contact a broker to help with the application.

Regex:
Do I need to own an account at Barclays? I am on a work visa (5yrs), I have lived in the UK for 2yrs. How do I go about this?

tshoboy: :
Barclays can also do 90% LTV, but you should have stayed in the UK for three years and be on a work visa (or similar visa that has long term residency). Moneybox has a free brokerage service. You can chat them up and they will advise you based on your situation.

semmyk:
Did a quick search. Interesting findings and learned new terminology AiP (adding to the list of key terms)

@Regex: I can't find anything from their site requiring one to have an existing account with them (Barclays) - www.barclays.co.uk/mortgages/agreement-in-principle/
As indicated by @Dupyshoo, it's best to go via a mortgage broker. Just ensure you engage with a credible broker.
Over time, I hope to curate a list of brokers mentioned on this forum. {Maybe, I could even ipe them to a list and do data analysis and ML/NLP on them! )

From www.barclays.co.uk/mortgages/help-to-buy/mortgage-guarantee-scheme/
"The government’s mortgage guarantee scheme enables us to offer 95% mortgages for first-time buyers and people looking to move to a new home – as long as they have a deposit of between 5% and 9.99%. It’s available for buying a property that will be your only home, and you’ll need to submit your mortgage application to us by 31 December 2023."
Well, apparently, the 95% LTV won't be available to those without ILR or residency less than 3yrs. Nonetheless, it's worth exploring.
I must say, without reading this and the 'email' response to @tshoboy, I won't consider Barclay for a mortgage. Hum, no wonder they say never judge a book by its cover!

dupyshoo:
Easiest way to find out about what each mortgage lender accepts is to search for the lender name with intermediaries. For example, searching for Natwest intemediaries will give you details about Natwest lending criteria.

semmyk:
Did a quick search. Interesting findings and learned new terminology AiP (adding to the list of key terms)

@Regex: I can't find anything from their site requiring one to have an existing account with them (Barclays) - www.barclays.co.uk/mortgages/agreement-in-principle/
As indicated by @Dupyshoo, it's best to go via a mortgage broker. Just ensure you engage with a credible broker.
Over time, I hope to curate a list of brokers mentioned on this forum. {Maybe, I could even ipe them to a list and do data analysis and ML/NLP on them! )

From www.barclays.co.uk/mortgages/help-to-buy/mortgage-guarantee-scheme/
"The government’s mortgage guarantee scheme enables us to offer 95% mortgages for first-time buyers and people looking to move to a new home – as long as they have a deposit of between 5% and 9.99%. It’s available for buying a property that will be your only home, and you’ll need to submit your mortgage application to us by 31 December 2023."
Well, apparently, the 95% LTV won't be available to those without ILR or residency less than 3yrs. Nonetheless, it's worth exploring.
I must say, without reading this and the 'email' response to @tshoboy, I won't consider Barclay for a mortgage. Hum, no wonder they say never judge a book by its cover!

dupyshoo:
Easiest way to find out about what each mortgage lender accepts is to search for the lender name with intermediaries. For example, searching for Natwest intemediaries will give you details about Natwest lending criteria.

semmyk:
Placeholder 5
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[Mortgage Brokers]
{Vouch Level: 0 - 10] Depends on the number of mentions, references, feedback,s testimonies ...} PS: Vouch level is not an endorsement!
1. Moneybox - @Tshoboy | unverified | Vouch level: 1 | app | www.moneyboxapp.com/
2. Mojo - @SemmyK | unverified | Vouch level: 0 | online | https://mojomortgages.com/
3.
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5.
6.
7.
8.
9.
10.

Lexusgs430:
.......
RENT MONEY IS DEAD MONEY........
ASK YOURSELF THIS QUESTION ??......
WHY DO I WANT TO KEEP PAYING MY LANDLORD'S MORTGAGE??........

Santa2:
I recall sometime ago(i think last year ), someone did sort of review on property developers for new build family homes properties , I think in that barratt and taylor wimpey came at the bottom in terms of quality and low price, I am trying to find out ones on the other side of the spectrum. I wonder if anyone has a general overview of developers, best ones to go for.

Iolo:
Persimmon, Redrow, Bellway are some of the largest developers in the UK with reasonably good quality. In terms of build quality I do think it varies on the development and sometimes on the property within the same development itself. For example, a persimmon home in Leeds may be rubbish but another in Colcester of good quality.
The key thing is to make sure you do your background work as much as possible, and once the deal is closed get a professional snagger to identify issues and get them to fix it.
New builds will typically come with a 10 year warranty with the developer directly fixing issues within the first 2 years of your moving in.

nihilistjnr:
New Builds should be avoided as much as possible. Many of these developers are thieves.
For example, during this stamp duty holiday, new-build prices have gone up to swallow the money that buyers would have instead paid the government.
Same thing with help-to-buy, the 20% you get from the government has been priced into the cost of the house.
https://www.independent.co.uk/money/spend-save/help-buy-house-prices-loans-first-time-buyers-savings-a8958056.html
https://www.mirror.co.uk/money/help-buy-pushed-up-prices-16501487

The top 4 property developers in the UK are currently under investigation for their shady sales practices
https://www.business-live.co.uk/retail-consumer/barratt-countryside-properties-persimmon--18878586
Not all house na house...shine ya eyes cheesy