One of the things that we see a lot of as independent mortgage advisers, is clients who have been made to believe they can’t get a mortgage after being to one of the high street lender and being rejected. However the good news is that often we are the ones that can work together with more specialist or niche lenders and get that same client on the property ladder. We are not miracle workers but we know which lenders don’t just view things as black and white, those who thrive on working in those grey areas people can sometimes find themselves in from time to time in their lives.
There are sometimes additional costs for going to the specialist lenders, the free valuations that your main stream lenders offer are less popular, and there are more upfront fees involved. The rates are usually higher than those offered on the high street, but for many people who are currently renting even mortgages with these niche lenders are cheaper in comparison to the expensive rents that landlords can charge due to increasing demand. This is seen especially with those customers who are still a good way from retirement and therefore can spread their payments over a longer mortgage term.
Even if the rates are higher to begin with as long as the client improves their credit file during the initial advantage period of their “specialist mortgage” they should be in a better position come remortgage time. We sometimes find by this time that a lot of the initial issues if they were related to adverse items on the clients credit file, are that far in the past that it doesn’t matter to the lender anymore, or they are no longer on the credit file at all.
It is not only credit file issues that lead clients to our door, for example those who have only recently gone self-employed or only just started work as a contract worker can often find themselves being declined for a mortgage. However there are lenders out there who do not just take a computer says no approach. They will just ask more questions, such as are you still in the same line of work you were in previously? How long have you worked in this industry for etc. So don’t give up at the first hurdle please seek independent financial advice as it could make all the difference.
Sammy McCann BSc (Hons) Cert CII (MP)
13th May 2019