The attractiveness of current Bank of China mortgage rates (residential 2.8% and buy to let 3.88%), together will several features in the National Press this month has seen a sharp rise in mortgage enquiries to the Bank.

In an attempt to keep the level of new business under control the Bank of China have taken the decision to increase minimum mortgage size for new applications to £80,000.

How does this Bank of China decision affect you?

If you are seeking a Bank of China Mortgage of £80,000 or over you may think that this recent change will not affect you.

You should bear in mind however, that high demand for lending from the Bank of China will at some point result in an increase in product rate or possibly a temporary halt on new business lending.

Therefore if the Lifetime Tracker products offered by Bank of China are of interest to you. Make sure you take action today.

To make your enquiry – click the link below.

Since the start of 2012, our self-employed applicants are being asked for SA302’s by nearly all Mortgage Lenders. This can be a tricky one as these elusive pieces of HMRC paperwork are only supplied by the Tax Office if you ask them to calculate your tax payment. Most of our clients calculate their own tax payment or pay a Professional such as an Accountant to do it for them. Therefore, they not only do not hold SA302’s, in most cases they have never received one, or even heard of them.

Why can’t Lender’s work on a reference from an Accountant or prepared Accounts?

That would seem to be the simple answer, but in today’s market simple does not seem to work; we even had one mainstream Lender refusing to issue an offer without an SA302 even though the clients Accountant could confirm his income, the Business where he was a Partner could confirm income, and his Bank Statements showed a regular five figure monthly payment from the Business.

click here if you are self-employed and need a mortgage.

So what is an SA302?

Google will tell you it is a part of a Ricoh photocopier, a porcine antibody, and a thirty inch convection wall oven – no mention of HMRC.

You can get smart and try a search on the HMRC website home page.

Sorry…

There are no results for SA302

Further fishing in the HMRC Self-Assessment section will give you the revelation …

Receiving your tax calculation

You’ll only get a tax calculation (form SA302) if:

you sent in or made an amendment to a paper tax return and asked HMRC to work out your tax
you sent in a tax return but HMRC doesn’t agree with your tax calculation

But my Lender tells me I need an SA302 to get my Mortgage – how can I get one?

Don’t try to find your SA302 online for download. You might find your tax calculation, but that is not your SA302, it doesn’t even say SA302 on it (but neither does an SA302, so let’s not go there).

You could ask your Lender, Mortgage Broker, Accountant, and Granny where to get your SA302 and get four different answers.

click here if you are self-employed and need a mortgage.

How to get an SA302

We only know of one way to get your SA302 and that is to call the HMRC contact centre and request it is sent to you by post.

A little tip before you call; make sure you have plenty of time and patience. The last two calls we made on behalf of our clients took us 5 minutes (pretty efficient when you are used to calling mortgage lenders), and 22 minutes (painful whichever way you look at it).

Have ready:

The Full Name of the person you want the SA302’s for (easy if it’s you)
Their Full current Address
Their date of birth
Their 10 digit individual tax code
Their National Insurance number (we like to have both)

Remember:

Be sure which tax years you need; we would recommend you request the last three tax years with the most recent ending not more than 18 months ago – that will satisfy most Lenders.

Unless you are the tax payer the HRMC agent will not discuss detail with you. So be sure returns have been filed for the years figures you need.

HMRC will post the SA302’s only to the registered address. Their post is very slow (yes even slower than that postcard from Benidorm you got last Thursday) and could take 7 to 10 days.

That SA302 phone number

Call  0845 900 0444

Ignore the first automatic option set
Select option 2 in the main menu set of options
Select option 5 in the third set of options

Wait patiently and a member of HMRC call centre staff will answer. They are a nice bunch and handle your query quite quickly once you get through.

click here if you are self-employed and need a mortgage.

Sarah Beeny is heading to Battersea, Clapham and Streatham, as part of a brand new property series for Channel 4.

Sarah is well known as a Property Developer and Television Presenter following the success of series such as Property Ladder and Britain’s Best Homes.


Now she is back with a new series and new format featuring buyers of a variety of different properties.

Reef TV is currently seeking property buyers to appear in the programme.




Prospective buyers will view a selection of similar properties, before choosing their favourite property and making the crucial decision of whether they will place an offer or not.

A Mortgage Now has been asked by the Producers to help find buyers who are interested in taking part in the programme.

Sarah is currently seeking buyers who are interested in the purchasing the following type of properties:

• 1 bed properties in Battersea/Clapham, up to £350,000
• 4 bed properties in Streatham, up to £500,000

Buyers would be required for approximately 2 days filming.

Filming dates would be either the 8th or 9th May & 16th or 17th May.

For further information and to register your interest use the form above or alternatively please call a member of the team on 0207 539 2011 or 0207 539 2012.

Mortgage News – Q2 2012

Interest only Mortgages

Lenders made their biggest changes to criteria in the first quarter of 2012 in the area of interest only mortgages. The focus is on encouraging more clients to take their mortgages on a full capital repayment basis. Both Abbey Santander and Halifax (among others) have set maximum loan to values on interest only mortgages to 50%.
This can be a problem for home movers who are currently on interest only and cannot borrow more from their current Lender without switching to a full capital repayment basis.
We are now frequently having to tell clients that one range of rates and Lenders is available if they require interest only, and another for capital repayment.
We often have enquirers requesting interest only ‘for a couple of years whilst we are finding our feet’ – please be aware that interest only repayment methods are not a solution to affordability issues.
In all cases where Lenders allow interest only, they expect to see evidence of repayment vehicles in place to cover the capital borrowed at the end of the term.

Criteria for repayment vehicles has also tightened and most Lenders will not now allow the sale of the mortgaged property as an options. ISAs are the favoured interest only support products but expect to be able to prove regular payments and a current value with most Lenders.

New build Mortgages and loan to value

Lenders have never been confident on the sustainability of values for newly build property. In the current market they do not want to be left ‘holding the baby’ if a purchaser defaults on a mortgage on a property for which they may have paid a premium price.
Lenders protect themselves by reducing their maximum lending on newly built property and this can be a problem for first time buyers who favour new property. There are only a handful of channels we can use for low deposit cases on new build houses and even fewer on new build flats.
If you do intend to purchase a new build make sure we are aware of this at outset. There are a number of things we can do if fore warned to position your application effectively.

Tightening of credit scores

There seems little doubt that many Lenders have raised the bar in relation to their credit scoring on plus 75% loan to value lending. This has left clients, who we would expect to go through comfortably having a bumpy ride through mortgage underwriting.
As mortgage Lenders have less money to lend they can afford to be picky about who they will and will not accept.

You can help us to help you by being clear at outset if there are any problems on your credit file. Also, make sure we know about all outstanding credit items. Mention in particular anything that has recently been paid off.

Service standards

Lending criteria changes by many of the major Lenders in quarter two have seen a workload shift in some sectors of the market.

We are seeing a number of mortgage providers with simply more work than they can handle. This had led to waiting times of over 15 minutes on the telephone and in one case seven days delay between receiving an item of information and looking at it.

Lenders websites and IT systems (never reliable at the best of times) have caused further problems and we even had one Lender this week that did not have a working fax number.
You can help us but giving us a little more notice when you want to take action and getting any requested information back to us as quickly as possible.

Increasing rates

At the start of 2012 there were a number of competitive fixed rates on the market and we were seeing clients take the opportunity to fix for two to five years terms, particularly with re-mortgages under 75% loan to value.
Since the end of February, Lenders are not competing in the fixed rate market and we have seen rates move steadily ‘North’.
Having said this we still believe current two and five year fixed rates are good deals for clients and the remainder of the spring and early summer may be the best time to access them.

The message

Underwriting criteria continues to tighten and every day applicants are confronted with complications they did not expect.

Make sure you use an experienced independent mortgage broker to assist you throughout the process.

Skipton Building Society have announced that their policy on interest only mortgages will change with effect from tomorrow 27th March.

The current maximum loan to value on interest only applications of 75% will be dropped to 60%. Applications between 75% loan to value and 80% loan to value can be taken 60% interest only and the rest Capital Repayment.

All mortgages above 80% loan to value are available on a capital repayment basis only. Any Lending above £500,000 must be on Capital Repayment as must all lending to First Time Home Buyers.

This announcement continues the trends among lenders evidenced since January and is driven by the mortgage market review and the regulator’s position on interest only mortgages as part of that review.

If you require an interest only mortgage, or a mortgage from Skipton Building Society – contact us now.

This is a precursor to the Lender announcing a new range of interest only mortgage products which we expect next week.

This spilt of product between mortgages to be taken on a capital repayment basis and mortgages taken on an interest only basis is not new in the market. We have seen Halifax set prices differentials between capital repayment and interest only deals in the past.

What form the Nat West changes will take remains to be seen. Our guess is that lower loan to values on the interest only range is inevitable, and higher pricing on the range a possibility.

The message here is that securing an interest only product is more difficult than ever and is best achieved with the help of an independent mortgage broker.

If you require an interest only mortgage – contact us now.

This puts further pressure on the availability of interest only mortgage options from 50% to 75% loan to value leaving just a handful of Lenders with their interest only policies intact.

We would urge anyone who needs an interest only mortgage above 50% loan to value to take action immediately.

If you require an interest only mortgage – contact us now.

In April 2011 Nationwide reduced maximum loan to value for interest only mortgage applications from 85% to 75%, and this current move brings them in to line with their major competitors.

There are a number of Lenders still offering interest only mortgages above 50% loan to value but we expect that market to shrink further during next quarter.

We would urge anyone who needs an interest only mortgage above 50% loan to value to take action immediately.

If you require an interest only mortgage – contact us now.

The Government’s Newbuy Guarantee Scheme was launched today.

We picked this up in our blog on 2nd February and our view has not really changed. (at that point the label seemed to be New Build Indemnity Scheme)

If you want to find out mortgage about the scheme visit our Newbuy Guarantee Scheme page

Who does the Newbuy Guarantee Scheme benefit

The Building Worker
Yes, this should mean more work for building workers

The Developer
Yes, they set the prices and will make sure they are not out of pocket. They also have the benefit of a large amount of the risk being picked up by…

The Taxpayer
Whilst the Government will be enjoying the headlines, once again they are putting up the taxpayer cash to make the world sweeter for…

The Lender
The Lender looks to us as winning all round. The Taxpayer and Developer are picking up the risk and the Lender gets to charge 90%+ rates for what is a 80% mortgage in all but risk profile.

The Buyer
You could be a winner if your cash situation means that you cannot finance a 10% or 20% deposit yourself. For first time home buyers this could be a good opportunity to get on the housing ladder.

If you can raise a sensible deposit from your own resources we suggest you look at a standard purchase and reduce the risk of paying too much for your property and your mortgage.

Please note that the Government web page on the scheme says…

‘The existence of the indemnity does not provide any additional protection for the borrower nor protection from repossession. It does not cover the borrower against negative equity or a shortfall between the sale price and the outstanding debt.’
‘In the unfortunate event of a home being repossessed, the borrower will still be responsible for repaying any shortfall between the sale price of the property and the outstanding mortgage debt.’

The Council of Mortgage Lenders say…

Buying a property with a mortgage under the NewBuy scheme is likely to be more suitable for people who expect to stay in the property for a number of years rather than those who plan to move soon.

If you take out a mortgage on a newly-built property that represents a high percentage of the value of the property – between 90% to 95% in this case – there are some things you should consider. Some new-build properties include an extra premium on the sale price that can reduce as soon as someone moves into the property. This potential reduction in the value of the property is an important factor you should consider when buying a new home using a higher LTV loan. If house prices fall, you may not have enough money from selling the property to repay the mortgage.

If the amount you owe under your mortgage is greater than the value of your home, this is called ‘negative equity’ and could make it difficult to move or remortgage unless you can meet the shortfall from savings or other sources. However, this is a risk of high loan-to-value borrowing (where you borrow a large percentage of the value of the property), not of the NewBuy scheme itself.

You may be able to borrow more (in other words, get a further advance) if your lender agrees, but at this point the scheme would not apply to you, and that may mean the lender will not be prepared to lend.

You should get financial advice if you are in any doubt about whether a low-deposit mortgage is right for your circumstances.

Congratulations to Andy Golding and his team at Kent Reliance Building Society for showing some real imagination in the launch today of the innovative new Mortgage for the Self Employed.

The Mortgage for the Self Employed – which we can access exclusively through specialist distributor Brightstar Financial, is designed to help enterpreneurs in the early years of trading by showing some real flexibility in underwriting. Rather than relying on the computer driven, rules based approach used by other Lenders, the Mortgage for the Self Employed will be underwritten manually on a case by case basis.

This approach will allow us as Mortgage Brokers to help Mortgage and Re-Mortgage Applicants with just one years trading accounts and a minimum 20% deposit.

Please note: This is not a self-certified product, nor is it anything like it.

The Lender will want to see 6 months personal and business bank statements to evidence good income through the business and financial stablility.

We do not expect current profit levels within the business to be a critical factor, but you can expect to evidence a business that is making rapid progress and projecting good profit going forward.

A valuable extra feature is the flexibility of having no early redemption penalty on the product allowing the borrower to investigate and utilise other funding options as the business track record improves.

Please remember that this is an exclusive product which an applicant can only access through approved independent mortgage brokers such as A Mortgage Now.

For more information on mortgages for the Self-Employed please see our video below