The coronavirus pandemic has sadly now seen tens of thousands of people in the UK lose their lives, with the government reporting there has now been 41,736 deaths to COVID-19. The crisis has had a financial impact too, with millions of people across the UK being supported by forms of support such as Universal Credit and the Coronavirus Job Retention Scheme – also known as the furlough scheme.
So, should a person want to apply for a mortgage at this time, “there are a few things to bear in mind,” according to Mr Smith.
“Crucially, it’s important to think about your financial situation. Has your income changed recently? Will you be able to make payments now and in the future? When speaking to your lender/broker, provide as much information as you can about your income,” he said.
“Ultimately, they will want to protect you as much as possible, so that you can comfortably meet your payments and not find yourself in a financially vulnerable position.
“For example, consider the following when speaking to your mortgage advisor: have you been working more overtime than normal lately? Will this continue in the future or will your hours and overtime reduce?”
With millions of people having been furloughed via the government’s Coronavirus Job Retention Scheme, some may wonder where this leaves them in terms of mortgages.
Commenting on this, Mr Smith continued: “Most lenders will lend to those who have been furloughed but each lender will have their own lending criteria.
“Your mortgage advisor will be able to help with the best options for you. For more complex income circumstances, a specialist mortgage broker will be able to talk through your options.
“The physical process of buying a house has also changed very slightly – there will be more social distancing for example and so it is likely a mortgage meeting will take place over the phone rather than face to face.
“A mortgage meeting over the phone is easier to book in whereas face to face is a little more difficult at the moment.
“The Government has recently issued detailed guidance on how house viewings should be conducted with social distancing in mind.”
Amid market changes, mortgage lenders have also made alterations, something which the mortgage expert highlighted.
“With the rapid market changes, we’ve also seen banks responding very quickly and reintroducing higher loan to value products.
“At the moment, most banks have reintroduced lending up to 85 percent of the value of the property – so there are more mortgages becoming available again for those with a 15 percent deposit.
“Do your research and speak to your advisor about the best mortgages for you.”
Mr Smith concluded: “The market is changing rapidly and we are seeing some confidence grow in the housing market, which will be welcome news for those eager to buy a new home or to remortgage.
“There are mortgages available, but you will need to remember to do your research and have open discussions with your mortgage advisor.”
Published at Tue, 16 Jun 2020 09:23:00 +0000