New Rules for Lenders on Buy-To-Let Landlords from the Bank of England

The Bank of England (BoE) is introducing new mortgage regulations for landlords. They will come into effect from the 30th September 2017.

It will mean that when applying for mortgages for new properties, most landlords with three or more mortgaged properties that they rent out, will need to give much more information regarding their existing properties, assets, income, liabilities and costs.

How will things change?

At the moment the majority of lenders focus mainly on the value and rental income of the property they are lending against when underwriting buy to let mortgages.

With the new underwriting requirements from the BoE, all lenders will need to collect and validate information regarding every property that the landlord has an interest in when considering their application. This will include collecting information on rental income, property values, mortgages and costs from each and every property the landlord owns.

The reason the BoE has asked lenders to change their approach is that they want lenders to have a full understanding of the financial circumstances of landlords with multiple properties and the impact that any new lending might have on their finances.

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Posted in News

What Will Divorce Mean for Your Mortgage?

Going through a divorce is a really tough time for everyone involved. And unfortunately it can be made even more difficult when dividing up your assets.

Deciding what happens to your family home will probably be one of the biggest financial decisions you will face.

If you know what solutions are available to you and the choices you might want to make it can make the whole process much less traumatic.

So we’ve laid out your options below . . .

Several Choices Available

There are a variety of options available to both of you, but precisely what happens to your mortgage will largely depend on your plans for the house and your individual circumstances.

It’s very important to consider that during this process you will need to continue to pay the mortgage until you have reached a solution. When two people take out a joint mortgage they are agreeing to be equally liable for the debt for the duration of the loan and not just whilst they live in the property. Therefore any failure to pay the mortgage on time can be damaging to your credit histories.

Sell Up and Move

Selling the family home and both parties leaving is often the easiest and most straight forward way to avoid any issues. Selling the house and paying off the mortgage is a clean break and the least messy. Any equity left after the mortgage has been paid off can then be split equally between you both.

However, we appreciate that for both sentimental and practical reasons this isn’t always the route people want to take.

Buy the Other Out

If one partner wants to stay in the family home they will have to prove to the lender that they are fully capable of covering the mortgage payments on their own. This is vital as your lender is not legally obligated to remove the other party from the mortgage.

The partner who wishes to remain in the house will be assessed as if they were a new applicant and the lender will then decide whether the mortgage is affordable for them. If you can satisfy the lender that you can afford the mortgage then they may agree to you becoming the sole mortgage holder.

If the lender agrees then you will need to buy your ex-partner’s share in the property. A ‘transfer of equity’ will need to take place. In most cases your current mortgage deal will remain in place. You may however need to get a valuation which will undoubtedly come with an additional fee.


Instead you may wish to remortgage; especially if your mortgage is free of any repayment charges. The transfer of the property ownership can then take place at the same time and is likelier a quicker option.

Get a Guarantor

Should the above solutions not be viable options you can take out a guarantor mortgage. You’ll need to find someone – usually a parent or sibling – to guarantee you will be able to meet your mortgage payments. If you miss a payment your guarantor could be liable to pay the debt to your lender.

What if you are in Negative Equity?

This is a term used to describe your financial situation when the current value of your home is less than the amount you have outstanding on your mortgage. Negative equity can present an immediate problem for those going through a divorce.

Unless you have savings that can be used to repay the difference between the value of your home and the mortgage your options are likely to be restricted. If you are unable to sell the home to pay off the mortgage in full you’ll need to speak with your mortgage provider to discuss the best options moving forward.

Help and Advice from Limetree

Whatever you current situation may be, get in touch with Limetree to discuss the best possible solution for you and your family. Our specialists can help you through the process to ensure minimal stress to all of those involved.

Posted in Uncategorized

Want to Release Some Equity for Home Improvements? Here’s How…

Owning your own home is a great joy for many, but it does come with its responsibilities. Over time, your home will not only need general maintenance work, but you may find you want to make changes and improvements.

For homeowners who are coming to the end of their mortgages, or have indeed cleared them, equity release is a fantastic way to raise some funds for their much desired improvements.

Whether you want new PVC windows and external doors or just to have a bit of landscaping done in your garden – let us tell us what your options are for equity release.

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Posted in Uncategorized

Think you’re not able to get your foot on that property ladder? Think again!

In the current climate, many people see home ownership as an impossible dream. Trying to get a foot on the property ladder can be a real struggle. Many people are leaving university with a huge debt behind them and starting low paid, entry level first jobs. Being able to save enough money for a deposit is a common problem.

But the government has introduced a number of different Help to Buy schemes, all aimed at those struggling to buy their first home.

We’ve explained them all for you here, to try and help you navigate the maze.

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Posted in First Time Buyers

Amazing New Mortgage Deals Released

Last month saw the release off two great offers from different banks, making it even more achievable for you to own your own home.

The Bank of Ireland UK has announced a range of 95% loan-to-value (LTV) mortgage deals to replace the government’s Help to Buy mortgage guarantee scheme which came to a close at the end of 2016.

The purchase-only scheme includes three products which come with a minimum loan size of £50,000.

Deals in the scheme are a two-year fixed rate at 3.89%, a three-year fix at 3.98% and a five-year deal at 4.09%.

The bank stated that it hoped its range will give greater opportunities to first-time buyers, particularly those who are struggling to save a deposit.

Alison Pallett, Director of Sales at the Bank of Ireland UK, said: “We believe that first-time buyers are integral to the long-term health of the housing market, helping to stimulate activity at all stages of home ownership. We hope that this new proposition will help to enable the next generation of home owners to take their first steps onto the housing ladder.”

It was also announced last month by Clydesdale Bank that they will be waiving the valuation fee on their first time buyer range, but for a limited time only.

They are currently offering FTB products including a two-year fixed rate at 3.59% up to 95% LTV. Three-year fixed rates start from 2.89% up to 90% LTV and 3.99% at 95% LTV.

The bank is able to lend up to five times the income (sole or joint) of mortgage applicants, depending on the overall affordability.

They are also reducing rates across its mortgage range by up to 0.50%. Two-year fixed rates now start from 1.34% at 75% LTV. Five-year fixes are available from 2.04% at 75% LTV, rising to 2.19% at 80% LTV.

Here at Limetree Financial Services, we are able to access offers from Clydesdale Bank, where not all brokers can. So do call us today for more information about this incredible deal while it lasts!

Posted in Mortgages, News