Low Setup Cost Mortgages

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How Much Can I Afford?: You have to be very careful when buying a house to be sure that you will be able to afford the monthly mortgage repayments – as you risk losing your home completely if you find you simply cannot afford it.
How Do I Prove My Income?: When you apply for a mortgage you will normally have to provide proof of income. However, there are mortgages available, called Self-Certified mortgages, where this is not necessary.
What If I Die Before My Mortgage Is Paid Off?: If you die before your mortgage has been repaid, your estate will face the cost of paying back the outstanding balance. The mortgage will not be written off by the lender, it will have to be paid by the next of kin.
Equity Release: Equity Release is a means of using the value of your home to receive either a lump sum of cash or regular monthly instalments.
What is Adverse Credit?: If a borrower has a history of poor credit usage then this is described as Adverse Credit, Sub Prime or just simply, Bad Credit. Poor Credit history can include County Court Judgements (CCJ's), Bankruptcy, Mortgage arrears or any late payments on credit cards, credit arrangements etc.

When you apply for a mortgage and to buy a property, there are certain initial costs that are, on the whole, unavoidable.

Property evaluation and survey

First you have to have a property evaluation and survey – this has to be carried out so the mortgage lender can ascertain the size of loan they are prepared to make for the property. This valuation usually costs around £130 but this will depend on the size of the property and the detail you require within the report. The survey is also an essential cost, because if it transpires that the property is afflicted by structural problems such as subsidence, dry rot or vermin, there will be no recourse once you own the property. The Home Buyers' Survey and Valuation (HBSV) report will cost from £250 upwards, again this is in relation to the size and value of the property. It is sometimes possible to arrange for an HBSV report to be undertaken by the mortgage company’s surveyor on the same occasion as the valuation report, this will save you part or all of the valuation fee. You can save as much as £100 - £200 doing this, and if you go to one of the larger lenders they are likely to offer this service.

Stamp Duty

You will also need to pay stamp duty on your property. Some mortgage lenders will offer to pay this for you as an incentive, and there are some properties that have been purpose-built i.e. a block of flats will waive the stamp duty charge, again as an incentive for buyers. Stamp duty exemption has been available since 30th November 2001 for the purchase of property in certain designated disadvantaged areas of the UK, and where the consideration, or premium for a lease, does not exceed £150,000.

Deposit

You will also need to have some savings for a deposit as most mortgage lenders will only offer a mortgage of up to 95% of the property value. You can get a 100% mortgage which will save you from the initial outlay of a deposit, but will cost you a lot more in the long run, with considerably higher monthly repayments.

What Is Conveyancing?

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