Are you buying a home in the UK?
Whether you’re a first-time buyer or looking to upgrade or downsize to a new property, understanding the mortgage market is crucial. In this mortgage guide, created for you by the expert team at Properly, we will delve into the intricacies of the UK mortgage market, equipping you with the knowledge to make informed decisions.
So, let’s embark on this journey and unravel some of the mysteries of mortgages!
The Importance of Mortgage Research
Finding the right mortgage is like finding the perfect key to unlock your dream home! Conducting thorough research is essential. Start by familiarising yourself with the different types of mortgages available in the UK. These include:
Each type has pros and cons, so choose one that aligns with your financial goals and risk appetite.
Understanding Interest Rates
Interest rates play a significant role in determining the cost of your mortgage. Keep in mind that interest rates can be fixed or variable. Fixed rates offer stability, whereas variable rates can fluctuate with market conditions. Consider your financial circumstances and preferences before making a decision.
Loan-to-Value (LTV) Ratio
The Loan-to-Value ratio is the proportion of your property’s value that you borrow from a lender. It is a crucial factor that affects mortgage eligibility and interest rates. Lenders generally offer better rates for lower LTV ratios, as the lower the LTV, the smaller the risk exposure for them. Aim for a higher deposit to reduce the LTV ratio and potentially secure better mortgage deals.
Affordability Assessment
Lenders in the UK conduct affordability assessments to determine if you can afford mortgage repayments. They assess your income, expenses, credit history, and outstanding debts. Understanding your financial standing and budgeting can enhance your chances of getting approved for a mortgage.
The Role of Credit Scores
Your credit score is pivotal in securing a mortgage. It reflects your creditworthiness and provides lenders with insights into your financial responsibility. Before applying for a mortgage, review your credit report and address any discrepancies. Paying bills on time and reducing outstanding debts can positively impact your credit score, improving your chances of mortgage approval.
Stamp Duty Land Tax (SDLT)
SDLT is a tax imposed on property purchases in the UK. The amount varies depending on the property price and whether you are a first-time buyer. Understanding the SDLT thresholds and exemptions can help you plan your budget accordingly.
Mortgage Fees and Associated Costs
Aside from the mortgage itself, there are other costs to consider. These may include mortgage arrangement fees, mortgage broker fees (if you are using a mortgage broker), valuation fees, legal fees, and more. Familiarise yourself with these costs to budget correctly and avoid surprises during home-buying.
Government Schemes and Support
The UK government offers various schemes to assist home buyers, particularly first-time buyers. These schemes include Help to Buy, Shared Ownership, and Right to Buy. Researching and understanding these initiatives can provide you with financial aid and make buying your dream home more accessible.
By reading this guide, you’ve taken a significant step towards becoming a knowledgeable home buyer in London. Now you’re equipped to make informed decisions that align with your financial goals,
Remember, when you’re ready to sell your home or look for a new property, our team at Properly is ready to help.
As experts in the property market, we’re confident we can help you find the perfect buyer for your existing property and the ideal new home to move into.
Either call today at 0207 459 4400 or email us at mariel@properly.space to find out more.
London Youth work to improve the lives of young people in London, challenging them to become the best they can, and last year helped over 27,000 young people through their sports development, youth action and involvement, arts and outdoor education programmes and employment prospects. We feel strongly that all young people should have an opportunity to develop themselves, and so are delighted to be able to support London Youth in their work, providing young people with access to opportunities they might not otherwise have had, to learn new skills, to make a positive change in their communities and to shape the city they live in.
Glass Door helps homeless men and women in London through their large network of emergency shelters and support services. These winter shelters provide a warm welcome, food, safety and shelter for up to 170 people every night. Properly feels passionately about the issue of homelessness. That is why we are delighted that together with our clients we can assist Glass Door in their fantastic work to help some of the most marginalised people in society.
Families become homeless for reasons we can all identify with. We are concerned about people who are struggling to keep things together in our fast-paced world – and we care about those who have no support. We chose the Doorstep Homeless Family Project because they are passionate and effective yet they are a small team with limited funding. They provide homeless families, living in temporary accommodation in London, with access to services to secure the emotional and practical support they require to enjoy a better quality of life.
We need nature and nature needs us. We support The London Wildlife Trust because we share its concern for the environment. We want to ensure that we keep nature in mind as we work in the property market – and crucially, with people’s homes. We also want our employees to engage with nature and benefit from the wellbeing this brings. London Wildlife Trust cares for over 37 of London’s spaces, and their vision is: “a London alive with nature, where everyone can experience and enjoy wildlife”.
Mariel helped me sell my apartment in West London. She was always there when I needed her. Her advice was invaluable and made everything a whole lot easier. I can’t recommend her highly enough.
I cannot recommend this estate agent enough. Michael and Mariel have been very good to us throughout the process and have made sure everything has been as smooth as possible. They have gone above and beyond to ensure everything was dealt with and in a timely manner too. A great experience throughout!
I was very impressed with the service I received. Communication throughout was very good. I have dealt with many agents, but the clear, concise and personable approach I received made Properly stand out. I wouldn’t hesitate to use them again.
The level of customer service I received at Properly with Mariel and her team was frankly outstanding. It’s lovely when people genuinely care and go the extra mile which certainly they did. I couldn’t recommend them more highly, the most pleasurable property experience ever for me.
Michael and Mariel have been very helpful from the time I contacted them on a property I was interested to rent and through the offer process. Mariel did a wonderful video call showing of the house since I was not in London at the time. I felt completely comfortable to sign the lease from the video call. Thank you Mariel!
Amazing people, responsive, honest, friendly and professional. Cannot fault them and the type of company, you will go back to again and again.
Had Michael round for a valuation of our flat – very knowledgeable and friendly and wasn’t pushy at all. When it comes time to sell we’ll definitely be giving Properly a call!
Mariel and Michael made the process of agreeing a housing let incredibly seamless, stress-free and quick. Their timely communication and fantastic ‘customer service’ was second to none. Would highly recommend