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Our property investment expert is Jeni Browne, Sales Director at
Mortgages for Business
www.mortgagesforbusiness.co.uk/
Tel: 0345 345 6788
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Question
How do I boost my deposit?
I am saving for a deposit on my first home and have already put aside nearly £5,000 into a savings account with my bank. I am hoping to buy a flat in the region of £250,000 and I’m hoping to save £25k. I work in IT and earn £35k a year.
Do you have any advice on how I can boost my deposit? Also what I can do to reduce spending? I don’t think I will be able to save in time to qualify for Help to Buy but do you think I might be eligible for shared ownership?
Answer
I think that you should definitely check out the Lifetime ISA (LISA). You can pay in up to £4,000 each year and the government will top up your savings by 25% (up to £1,000). You must be over 18 and under the age of 40 to open the account and you can pay into it until you are 50.
If you purchase a property with someone who also has a LISA, you will both get the 25% bonus.
In terms of reducing your spending, I would give yourself an allowance each month (start with a conservative number – it’s amazing how frugal one can be when they are really focused), transfer this into a separate spending account where your patterns are tracked (Monzo has a very good one) and spend only your allowance.
It can be helpful to look at the data the account shares with you, showing you how you may be able to make this allowance go further each month.
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Question
£10k in debt: Can I remortgage?
My five-year fixed rate mortgage is coming to an end soon and I am keen to remortgage to another similar deal. The problem is I was made redundant during covid and got into quite a bit of debt.
I used my savings to pay the mortgage and some bills and also built up quite a bit of credit card debt – around £10,000.
I am now back in work and trying to pay the debt back. How will this impact my remortgage? Will I be eligible or will I need to look at another option?
Answer
Typically, lenders will worry about offering to someone who appears to be living off a credit card. However, assuming this is a few months ago, and you are now back to getting a regular income and can prove the outstanding balance is going back down, I think you will be ok.
Do speak to a mortgage broker who will be able to put you in front of the right lender so that you can get the best deal possible.
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Question
Grade II Iisted cottage: Are there mortgage restrictions?
My husband and I are looking to move and we have viewed our dream home – a Grade II listed cottage. It’s idyllic and comes complete with a thatched roof but we are also wondering if this will make it tricky to take out a mortgage? We will be putting down a 40% deposit and we’ve got good credit history.
Answer
Well, it sounds gorgeous – straight from a chocolate box! There will be lenders who will not like the thatched roof, owing to the higher maintenance and costs that can come with this style of construction.
However, plenty of lenders view this as less of a risk, so don’t worry! The Grade II listing is fine – whilst this will limit what you can do to the property, this tends to be external/cosmetic and, as such, not too restrictive. Best of luck!
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Question
Self-build mortgage options
My brother and I are looking at buying a plot to build a house for my family and my mum. We want to take out a mortgage to cover the plot and building work and would like to know if we can use a standard mortgage or if there’s a specialist loan for building projects.
We’ll be paying the builders in stages so we were curious as to whether there was a mortgage to accommodate this.
Answer
You will need a self-build mortgage, where the lender releases the funding to you in stages. First at purchase of the land, then when the foundations reach first-floor height, then when the property is both wind and water-tight, and finally once it is completed.
These stages will vary based on your bank, and not all lenders will offer this type of product. I would recommend doing some research upfront or finding a broker specialising in self-builds to do the heavy work for you.
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