Month: March 2017

BMAs 2017
March 28, 2017

We need you!

Awards

The British Mortgage Awards recognise the stand out achievements of the most deserving individuals in the UK mortgage industry, and we are looking for your support to help us win one of their prestigious awards.

We pride ourselves on finding customers’ the right mortgage at the best price, no matter their credit score, and would be very grateful if you could nominate us for this year’s ‘Specialist Broker’ award, by voting for our Managing Director, Clayton Shipton.

Casting your vote is easy and takes less than a minute to do online VOTING NOW CLOSED

Should you need Clayton’s contact details to submit your entry, they are as follows:

Nominated Person: Clayton Shipton

Nominees Job Title: Managing Director

Nominees Company Name: CLS Money

Nominees Email: clayton@clsmoney.com

If you have any questions or require any further information, please do not hesitate to contact us at info@clsmoney.com

Thank you very much for your time in advance, we really appreciate your help!

Please note voting will close on Friday, 05 May.

VOTING NOW CLOSED

Young couple
March 27, 2017

The Lifetime ISA – Your new friend for life!

First Time Buyers / Mortgage

If you are looking to get on the property ladder or want to start putting a bit of extra cash away to support you in your retirement, you could get a free 25% cash injection to help you on your way!

Savers aged between 18 and 40, who open the new Lifetime ISA when it launches on 06 April, can put away up to £4,000 a year and receive an additional 25% tax free, government bonus until they reach the age of 50. By this time, you could have received as much as £32,000 in free cash! – Who doesn’t want free money?

Take note!

  • Contributions to a Lifetime ISA will count towards your annual tax free savings limit of £15,240 – Fortunately, this will rise to £20,000 for the 2017/18 tax year
  • If you withdraw cash for anything other than buying your first home or before you turn 60, you will incur a 25% penalty! – Be wise and only use it for home buying or retirement

Is it better than a pension?

The Lifetime ISA can be used to save for your retirement in addition to your pension. But, the rewards of only saving in a LISA are not as attractive and here’s why:

  • You can only withdraw cash from a LISA once you turn 60 – Not great if you plan on soaking up the sun and retiring early
  • For most, having a pension is just as beneficial, as you save from gross (pre-tax) income – Certainly wouldn’t be attractive to high earners
  • If you’re employed, the workplace pension scheme requires that your employer has to pay in as well – You won’t get this from a LISA 

What wins, Help to Buy ISA or Lifetime ISA?

You can save in both schemes, but will only be able to use the government bonus from one of them to buy your home. If you are looking to buy a property within the year, the Help to Buy ISA will enable you to get the government bonus faster, with a minimum deposit of £1,600.

But, for those looking or thinking to buy over the next year or so, the Lifetime ISA is far more attractive! Plus, if you already have a Help to Buy ISA and transfer your savings to a LISA before 06 April, the 25% bonus will be applied to the entire amount saved! – Now that’s certainly worth considering!

We have compiled a handy breakdown below to help you quickly see how each compare:

 

Question Help to Buy ISA Lifetime ISA
How much can I pay in? £1,200 in the first month, followed by £200 a month thereafter £4,000 a year
How does the Government bonus work? Maximum bonus of £3,000, which you receive upon completion of buying your home 25% applied to your savings at the end of the first year, monthly after that
What’s the maximum property purchase price? Can be used by First Time Buyers to purchase a home up to the value of £250,000 (£450,000 in London) Can be used by First Time Buyers to buy a residential property up to the value of £450,000
How long will I need to have it before I can use it? No time limit 12 months+
How can I use it? For a mortgage deposit only Can be used for your mortgage deposit and home deposit
Where can I get one? From most banks and building societies Stocks and shares providers at present. But, Skipton will have one for launch, and it is expected that other high street banks will follow

 

Ready to get moving?

Do you think the new Lifetime ISA will help you reach your savings target much sooner than expected? Are you thinking of buying a property in the near future and would like some advice? Our professional mortgage advisors are at hand to help you with all your mortgage related questions!

They will assess your personal circumstances and explain all your available options, so you can get a good idea of how much you can borrow and/or start searching for your dream home. Their advice is completely free, so get in touch!

Self-employed mortgages
March 20, 2017

How to get a self-employed mortgage approved first time, every time

Mortgage / Self-Employed

If you own your own business, you are probably used to hearing how difficult it is nowadays to get a self-employed mortgage – but this simply isn’t true. The process has certainly changed, as Self-Certification mortgages which enabled self-employed individuals to borrow money without proving their income, are no longer in use. But, your chances of getting a mortgage are just as good as anyone’s and here’s how.

Get organised!

Most mortgage lenders deem self-employed individuals to be a higher risk than a salaried employee, and therefore require at least 2 years accounts in the form of an SA302 form (proof from the HMRC that you have reported your income) and a tax year overview – Be wise and use a chartered or certified accountant to help you with this. They will ensure that your accounts are up to scratch and help you understand any details that you are not too sure about.

If you have less than 2 years’ accounts, it’s not the end of the world! There are lenders who will consider you. But, you will need to prove that you have either; have regular work, recently left full time employment and started contracting or can guarantee that you will have regular work in the near future.

Everyone loves stability

The self-employed mortgage process differs according to the set-up of your business:

  • Sole trader: A mortgage lender will look at your profits when assessing your income and usually request an SA302, to see the total income received and tax due.
  • Partnership: If you go into business with someone else, lenders will look at each partner’s share of the profit to determine you annual salary.
  • Limited company: The lender will need to see your business and personal accounts separately, in order to assess your mortgage affordability.

As lenders love to see consistency, you should delay making any changes to the structure of your company if you are considering this. If you can’t, it’s probably worthwhile postponing your mortgage application, in order for lenders to clearly see how the changes have affected your business. 

Looks matter

It’s usually always a good idea to retain more profit within the business. But, if you are too stringent with your income, it could affect your chances of getting a mortgage, so treat yourself! Paying yourself a higher wage for a period of time can help boost both your mortgage application and your savings –   Make sure you can still afford your mortgage repayments and other outgoings, if you choose to reduce your salary again though.

Save, save, save!

As with all mortgage applications, the larger your deposit, the lower your repayments will be – But, it can improve your chances of getting a mortgage even more so when you’re self-employed.

Let your partner take the lead

If your partner is a salaried employee, then adding them as the first name on your mortgage application, could also help your chances of getting it approved. They may not earn as much as you, but lenders will favour them, as their income is looked at as being more regular and predictable. 

Seek expert advice

Our mortgage advisors are experts in self-employed mortgages and can help advise you on how much you can afford to borrow, and source the best lenders to suit your individual needs, in order to maximise your chances of being approved first time. If you decide that a mortgage is the right choice for you, they will also complete all the relevant paperwork, and liaise with your lender, estate agent and solicitors to ensure that your application is a success!

March 3, 2017

Saving tips for mortgage success – no matter your pocket size!

Mortgage

A mortgage deposit is the largest amount of money most people will ever save. It’s a big milestone to reach. But, if you think smart and make a few small adjustments to your current spending habits, the pounds will soon pile up and you’ll be in your new home in no time!

How much deposit will I need?

The minimum deposit for a mortgage is 5%. However, the more you can save, the more favourable your mortgage rate will be. A 10% deposit would put you in a far stronger position and should be achievable if you are saving to buy a home with someone else – don’t forget to also budget for your moving costs; Stamp Duty Land Tax, valuation and legal fees!

Review your finances

Once you know how much you need to save, a thorough review of your finances could make all the difference. Make a simple list of all your outgoings including your; rent, insurance policies, energy bills, television, broadband, landline and mobile phone contract/s, and how much you are paying for them each month, and compare it with your monthly income, including your current earnings and any regular overtime payments and bonuses – this will give you a solid foundation to work from.

Clean up your act!

If you’re serious about saving for a mortgage, then cutting back on some little luxuries, such as your daily coffee or weekly takeaway, will free up some additional finances for your home fund. Lenders will also look at your credit history and spending habits when you apply for a mortgage, so an orderly bank statement could benefit your application!

Boost your savings!

Cash ISAs and savings accounts are two great ways to make your money grow faster. To make sure you stick to your plan, consider setting up a standing order or direct debit, so that your savings are automatically paid into your account every month.

  • ISAs: Allow you to save money tax free, up to the annual allowance of £15,240.
  • Fixed bonds: By depositing a sum of cash for a set period of time, you can secure a fixed interest rate. However, you won’t be able to access your cash until after the agreed time.
  • Savings accounts: Tend to offer slightly higher interest rates than current accounts. But, you usually need to pay in a certain amount each month to benefit from the interest.

Free, specialist advice & support 

When you are nearing your savings target, it’s a good idea to obtain an Agreement in Principle, which we can obtain for you at no charge!

Alternatively, if you would just like some free advice about your affordability options, our expert mortgage advisors are available 7 days a week to meet or chat with you to help you get your dream home.