Mortgages made clear



Your home may be repossessed if you do not keep up repayments on your mortgage.

 

Those of you who are looking for your first home may have an idea of the type of property you want, but do you know how much you are able to borrow in order to pay for it?

Whilst criteria will differ between the various lenders, how much you can borrow will depend on a few things:

 

Loan-to-value (LTV)

This is the amount you want to borrow in relation to the value of the property. For example, if you have a £30,000 deposit for a £150,000 property, you would need a £120,000 mortgage, 80% of what the home is worth which is 80% loan-to-value. Mortgage lenders specify LTV limits for all their mortgage products. How much of this you are able to borrow will depend on other criteria too.

 

Credit score

This plays a big part in determining: a-If they will lend to you, and b-if so how much. It’s always worth checking your credit score before applying for a mortgage and getting it back in good shape if you need to.

 

Your income and outgoings

Lenders traditionally applied a multiple of your income or joint incomes to decide how much you could borrow but will now also conduct a very detailed affordability assessment too. This is where payslips and bank/credit card statements will be looked at. The other outgoings lenders may take into account include things such as: Council tax, car running costs, child maintenance payments and utility bills. They will also ask you to prove you will be able to afford repayments in the event of a rise in interest rates.

 

Many people often feel at odds with lenders on how much they can afford to borrow which is why we always advise knowing what they look for beforehand to avoid not getting the mortgage you require.

 

So how can we help?

Aspire work closely with many different lenders so understand the different lending criteria they have. Our experienced mortgage advisers can guide you through the mortgage maze and match you with the lenders that best suit your needs.

Aspire consultants and affiliates are not tied to any specific provider and can source products from the whole market. Often we have exclusive products that are not available elsewhere in the market through our membership with the Intrinsic network.  To contact us click here.