How To Get Mortgage Ready - We Can Help!

How To Get Mortgage Ready - We Can Help!
By [http://ezinearticles.com/?expert=Yasmin_Ffion_Scott]Yasmin Ffion Scott

Whether you're a first time buyer or someone looking to get back onto the property ladder, acquiring a mortgage can be difficult. It is definitely a massive financial commitment, and you might find yourself uncertain as to whether you can truly afford the full costs of a owning your own home. Plus, when you start looking into securing your mortgage, you will find the process can get quite complicated, particularly with the new rules and regulations in place.

Firstly: what is a mortgage?
A mortgage is simply a loan taken out to purchase a property or land. Mortgages differ to regular loans as the mortgage is secured against the property, meaning that if you can't keep up the repayments, the lender can take the property back. The average mortgage runs for 25 years, but the term can be longer or shorter.

You can acquire a mortgage from a bank, building society or specialist mortgage lender. However, it isn't really that simple to get approved for a mortgage loan. Before they approve, each potential lender has to go through a thorough check, including a credit check, to make sure you can truly afford the costs of the mortgage repayments and the property upkeep. This is the part where most people can stumble.

Mortgage Checks
When deciding when to lend to you, the mortgage lender will take all of your incomings and outgoings into account. You may have to produce bank statements and payslips to prove that your finances are viable. These checks can sometimes feel quite invasive, as your outgoings include any debts, household bills, and even various costs of living.

The rules for mortgage checks got tougher after April 2014. They have now introduced "stress tests" and other questions to make sure you would be able to keep up with your mortgage repayments and property costs if your interest rates went up or if your circumstances changed. They mainly focus on the future, and look ahead to asking questions about any future changes that could affect your circumstances, such as if you are planning to have a baby, retire, or any other substantial changes.

This is where Homes With Options can help!
With us, you can move into your future home and start building up your mortgage deposit through your monthly rental payments. Also, with the extra time of renting the property before you commit to a mortgage, you are able to save up extra towards your home and make those essential changes.

If you have had difficulty becoming mortgage ready previously, this will secure your chances of getting approved immediately once your Rent-to-Buy term ends. Also, we will help you through the entire process, making sure you secure a solid mortgage loan.

Before you take out a Rent-to-Buy scheme with us, we will test your mortgage eligibility. We can test straight away whether you would be ready for a mortgage now, or in a few years' time. Then, you have the time to sort out your finances and situation to become fully mortgage ready.

A Rent-to-Buy scheme is basically an easy way of saving towards your mortgage and property. However, the main difference is that you can live in your future home while you save. That way, you are investing in your future and all of your finances go towards your future property.

Renting nowadays can be just as costly as mortgage repayments, which does make it difficult to save for a future property at the same time. With rental costs on the rise constantly, throwing money away on rent will only make it harder to save for your future.

The current schemes last 3-5 years on average, which is usually enough time to contribute to a good mortgage deposit, and sort out your finances to become fully mortgage ready.

When you are ready to apply for a mortgage after our scheme, your chosen mortgage lender would also take the scheme into consideration. It will help to prove that you are serious about owning your own home, and prove that you can afford your future mortgage repayments.

Example:
Dean and Lucy recently bought their first home with us. As they are both self-employed, they struggled to prove their earnings to the mortgage lenders who asked for three years' worth of accounts. They had a fantastic �5,000 to put towards their deposit that they had saved over time.

They fell in love with a lovely potential family home: 3 bedrooms, 2 bathrooms with a large garden and off road parking.

This is how their deal worked:

Purchase Price �99,995

Deposit (which is usually 1%-3% of the asking price) �5,000

Monthly Rent �300

Monthly 'top-up' �150

Dean and Lucy will build up their deposit using their top-up payments and have 5 years to purchase the property.

Deposit:

Year 1: �1,800

Year 2: �3,600

Year 3: �5,400

If they wait 3 years to buy their home, they will have built up a �10,400 (�5,400 top-up payments plus �5,000 deposit), which is just under 10.5%. This means they would only need a 90% mortgage and would now have the 3 years accounts requested previously.

Hopefully, this is a good solution for someone who wants to get on the property ladder, and secure a mortgage loan easily!

Through Homes With Options, we will help you secure a mortgage, whether you're a first time buyer or simply looking to get back onto the property ladder.

We will sort out your ideal home through our flexible Rent-to-Buy scheme, which will help you become financially compatible and fully mortgage ready!

Contact us today: http://www.homeswithoptions.co.uk

Article Source: [http://EzineArticles.com/?How-To-Get-Mortgage-Ready---We-Can-Help!&id=8716811] How To Get Mortgage Ready - We Can Help!