Sponsored by Private Wealth Mortgages

The sale of newly built homes has been hard hit in the current climate with lenders restricting their offerings with particular emphasis in this arena.  Developers are having to work hard at marketing to prospective buyers and even when a property is sold ‘subject to contract’ when the mortgage applications are submitted, there are certain obstacles that need to be overcome for the sale to go through.

Buyers need to be aware that many valuers are down valuing newly built property at the moment.  They continually look for comparables that have been sold in previous months and one lender in particular has instructed their surveyors to value the properties based on a ‘second time sale’ as they are concerned that if they had to resell the property, without the benefits that a developer is offering eg:  5% deposit paid, then the sale price they would achieve would be lower than the price the developer is selling at.  Lending will be based on the figure the mortgage surveyor values the property at – not necessarily the figure the purchaser is paying and this can affect the amount of mortgage offered.

Stamp duty being paid, and other benefits need to be declared at the outset and it is vital that the mortgage broker/lender is aware of exactly what funds are being provided by the buyer.  A 10% deposit being paid by the developer does not mean that a 90% mortgage could be achieved and lending at this level is restricted currently and only offered by a few select lenders.  Mortgage lenders usually only accept a maximum of 5% deposit being taken into account when calculating what a client can borrow.

There are restrictions on the maximum loan against the value of the property!  For example, a lender may only offer 65% as a maximum on an investment purchase if the property is a newly built flat.  Maintenance and service charges are taken into account when assessing affordability so this information needs to be checked as well as the terms of the lease, if the property is not freehold.

Although a newly built home and the benefits it offers are attractive, good advice is essential to avoid a buyer paying out for fees to lenders and valuers being lost if the proper information is not provided and agreed at the beginning of the transaction.

If you need further mortgage advice please contact us on www.privatewealthmortgages.co.uk

There are many options available to prospective clients when considering buying a property or reviewing their current mortgage. The internet has made it far easier to find out about information and rates available, and even apply online for a mortgage without having to speak to an adviser or visit a local branch!

However, we firmly believe that whatever advice is out there or provided through various forms of media, the world of mortgages is still a minefield! The endless source of information does not necessarily make it an easier decision – sometimes it actually makes it more difficult as there are too many choices and options given.

At Property Price Advice, we would like to focus on the area of mortgage advice – to go back to basics and actually provide a service whereby you can have a conversation with a human being, who will understand your circumstances, and be able to answer any questions you may have. You may have used your bank before for your mortgage arrangements, or you may have a broker who arranges and reviews your mortgages for you – we would like to offer a further option.

Recent changes in the mortgage market have meant that some of the most competitive deals are not available through mortgage brokers – Since the credit crunch began, lenders have tightened up their criteria, the number of available mortgages has reduced dramatically and for many of the better rates available, a deposit or equity levels of 30 – 40% are needed. There has never been a more important time to receive the correct advice!

We are able to offer through Private Wealth Mortgages Ltd, an advice service to ensure you do receive the right advice FOR YOUR OWN INDIVIDUAL CIRCUMSTANCES. Private Wealth have access to all mortgage products available and can give you a comparison between products from lenders that will only deal with clients directly, and products from lenders who will allow a mortgage adviser to process them on a clients behalf. You will then have the opportunity of either going ahead and arranging your own mortgage, or working with Private Wealth who will assist you.

For an initial, free, no obligation consultation, please use the ‘contact us’ link and you will be contacted by one of the Private Wealth Team.

Please visit our website www.privatewealthmortgages.co.uk

Salli Anstey
Director
Private Wealth Mortgages Ltd
Suite 3, Hillreed House, 54 Queen Street, Horsham, West Sussex RH13 5AD

Tel: 0845 658 3470
Fax: 0845 658 3480
Mobile: 07932 156517

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Registered in England and Wales, number 5603163
Regency House, 61a Walton Street, Walton on the Hill, Surrey KT20 7RZ