Inform 2nd September 2022

If customers have chosen one of our residential purchase products with an original latest completion date of Friday 30 September 2022, we will be allowing them an extra month to complete on their new mortgage.

To support customers where the conveyancer advises they will not be able to complete the purchase by the end of September but expect to complete by the end of October, we will issue a new mortgage offer with an extended offer expiry date of Monday 31 October 2022.

Please note only the conveyancer can request the extension on an application.

During September if you view a previous offer document via Halifax Intermediaries Online this may show a Monday 31 October expiry date, however the conveyancer must contact us to request the extension or they will not receive a new offer and the Lender Exchange system, through which they request release of the completion monies, will not update to allow completion in October.

A communication has been issued to all conveyancers advising that if an extension is required, they should contact us to request the issue of a new offer with the extended offer expiry date.

This extension only applies to residential purchase products with an original latest completion date of Friday 30 September and not any other latest completion dates. If a mortgage with a latest completion date of Friday 30 September still cannot complete by the end of October then a new product from the range available at that time would have to be chosen.

Valuation reports

From yesterday when a Mortgage Valuation (Level 1) report is produced the customer will receive their copy of the report electronically rather than by post. This means the customer will receive their report quicker and we can reduce the environmental impact of printing paper reports and posting these to customers.

Once the surveyor has visited the property and completed their report the customer will receive a text message from our surveying partners e.surv with a link which will allow them to open, view and save a copy of their report.

If e.surv do not have a mobile number for the customer, they will need to produce a paper copy and post this to the customer’s address. As a reminder it is important that full and accurate contact details (mobile numbers and email addresses) are provided for all customers, as these are used to provide customers with important information during the application process and following completion.

A Mortgage Valuation (Level 1) is a basic property valuation for our underwriting purposes only and there is no change to when a valuation report is produced i.e. a report is only produced when the surveyor has visited the property to make a physical inspection and no report is produced if we use an Automated Valuation (AVM) or Remote Valuation.

You can currently support your clients to secure and book a new rate up to 90 days in advance of their current Barclays mortgage rate ending, however, we are pleased to confirm that from today, Thursday 1st September, we are extending this period to a 150 days for all existing Barclays mortgage holders.

What does this mean for you?
Within an uncertain rate market, demand for Product Transfers (rate switching) is growing and the extended booking period means you’re now able to assist your clients with a Barclays mortgage rate ending within 150 days who are looking to you to provide the assurance of securing them a new rate earlier.

Note: When you book a new rate in advance, we’ll apply the new rate to take effect as soon as your client’s existing rate ends.

What rates are available for product transfers?
Rates from our preferential Reward range are exclusively available to existing Barclays mortgage customers for product transfers and further borrowing.

View our competitive Reward range

How can I apply?
You can apply quickly and easily using our online rate switch tool with no documentation or signed declarations required.

Available for both Residential and Buy to Let applications, the easy to use tool is located within the tools section of the Barclays Intermediary Hub.

TSB are making some system updates this weekend, therefore the TSB Mortgage Pro will be unavailable between 9pm Friday 2th September and 6pm Saturday 3th September.

The changes will improve the application journey and more information will be shared with brokers soon.

New DIPs or applications should not be keyed during this time.  

If you have any questions, please contact your national account manager.  

The UK is likely to be in a high inflationary environment for a couple of years. Given the uncertainty this creates for interest rates, it could be a great time to consider a long-term fixed rate. LiveMore’s 10yr fixed rate products come with 5yr ERCs, meaning borrowers have the certainty of a 10yr fix but only have the commitment of a 5yr fix.

Click below to read how longer-term rates with reduced ERCs allow your customers aged 50-90+ to live their best lives, while enjoying flexibility and monthly certainty.

Read more.

At LiveMore, we offer a range of mortgage products, designed for borrowers from 50-90+. Below are some of the reasons our industry partners choose to work with us…

Mortgages made easy for borrowers aged 50-90+
Lending up to 75% LTV with Defined Term (TIO) or Open-Ended Term (RIO) options available.

A fresh look at affordability
We look beyond salary and age, focusing more on individual circumstances.

What your customers really need
Reduced early repayment charges on long term products, and up to 6-month payment breaks available when death / major life events occur.

Unique to the market Procuration Fees
Choose from Ongoing Proc Fee of 0.55% gross upfront plus an additional 0.13% gross, or Enhanced Proc Fee available on our 20year and Fixed for Life products of 1.10% gross upfront – Best of all, we’ll do this for the 15 years after completion provided an annual customer care call is completed.

From the 25th August Legal & General have changed the maximum age, at point of application for waiver of premium from age 54 to age 64 next birthday. This will apply to new business only.

Waiver of Premium (WOP) allows customers who have been incapacitated and unable to work, or who fail 3 of 6 activities of daily living once retired, for more than 26 weeks to continue their cover without paying premiums.

For new customers who choose to take WOP on term policies, this will be available to your client for the duration of the plan, right up until the expiry of the term (or the end of a successful WOP claim or core benefit claim is paid, whichever happens first).

Reasons for this change

• With customers choosing to phase or delay their retirement, allowing customers to add this benefit to a later age will deliver improved customer outcomes for more customers.
• Keeping your customers protected for longer. If this benefit is used and your customer is unable to work or struggling with the cost of their protection, we will cover the cost for their premiums meaning their cover will stay in place until the policy end date.

Thanks for your continued support.

‘’What is a bridging loan?’’ ‘’I’ve heard bridging loans are expensive!’’ ‘’I don’t want to take a bridging loan…. I want a mortgage’’

These are three of the most common things a commercial broker will hear when you mention bridging finance to clients.

There is a common misconception (somewhat historic) that a bridging loan is either the last resort or a form of finance that will cost an arm and a leg!

In fact, bridging finance can be one of the most flexible forms of funding for property investors and developers alike.

So what is commercial bridging?
In short, it is a form of finance that is taken over a short period (typically 1-12 months) to ‘bridge’ the gap in funding between buying a new property and selling an old one.

Historically, bridging was often the type of finance taken by investors when the sale of one property was not yet complete while funds were required to purchase their next property. This was very much what gave bridging the stigma of being ‘expensive’ as it was classed by many as a ‘last resort’ form of funding.

Attitudes have largely changed as many modern day property investors and developers see bridging as a very fast and flexible form of finance.

Bridging finance will often be utilised by investors when they purchase properties at auction and need to complete quickly (normally within 4 weeks)

Many investors see bridging finance as a method to access funds quickly to buy property or to secure opportunities that may otherwise be lost if funding was taken by slower buy-to-let lenders. A common example of how beneficial bridging finance can be, is when an investor buys a residential property (possibly at auction) that is a little bit ‘tired’, carry out a refurbishment programme (i.e. new kitchen & bathroom) and then sell the property after the works are complete to make a profit. Historically an investor may try to acquire such a property by using a low rate buy-to-let mortgage however, lenders cottoned on to this and introduced early repayment charges on such mortgages (up to 5% in year one!) to try to deter such practices. Investors then started to see the benefit of paying a monthly rate for their borrowings via a bridging loan – especially when they would have no penalties for repaying quickly.

Typical bridging rates range from as low as 0.45%* per month for low loan to value residential properties, 0.7/0.8% per month for semi-commercial properties (i.e. shop with a flat above) through to 1/1.25% for more unconventional commercial properties (such as Petrol Stations)

Lenders typically charge an arrangement fee of between 1.5-2% of the loan amount; will require a valuation of the property and a solicitor to act on their behalf.

Most lenders have specific lending teams that will deal with bridging loan applications as they appreciate the urgency and have relationships with solicitors who understand the importance that speed plays in such transactions.

At Watts Commercial Finance, we pride ourselves on explaining the lending options to clients and walking them through the pros and cons of bridging finance vs other potential lending options. Being a whole of market broker perfectly positions us to find the client the right lender based on the client’s individual circumstances and business needs.

Changed your mind on bridging finance?
Call us today on 03303 110777 or email advice@watts-commercial.co.uk to see how we can help you and your clients find the right home for those difficult cases.

*DISCLAIMER: Rates correct at time of writing – 21/06/22

As of 31 August, we have increased the interest rates on our lifetime mortgages. To find out more and to download the latest rates visit Lifetime Mortgage Drawdown+ and Lifetime Mortgage Lump Sum+.

Decisions in principle on our previous lower rates should be submitted for underwriting review no later than midday 12th September, with the deadline for full submission of applications being midday 13th September.

Please note that these deadlines only apply to new business and additional borrowing applications are on the prevailing rate.

Have you tried our lifetime mortgage calculators? The tools are specifically designed to help you assess exactly what borrowing is available for your clients and the associated interest rates.

LV= Equity Release Portal

In August Kensington Mortgages achieved a new service record! They’ve maintained day 1 turnaround on all new applications and documents for 8 months – the whole of 2022!

A record for both Kensington and the Specialist Lending market. Don’t forget, you can also talk directly to the underwriter handling your client’s case.

Affordability has rightly been talked about a lot this year. With inflation and mortgage rates rising, affordability will continue to be a major concern for brokers and their clients – in particular Key Worker clients.

However, a bigger concern could be that Key Workers, who would be first time buyers, may give up on buying their dream home before even exploring their options.

Fortunately, brokers hold a vital key themselves – through their market knowledge and awareness of those special schemes and products that can help these Key Workers. We just need to find a way of ensuring that these Key Workers make contact with brokers and don’t give up hope.

Read the full article here.

There are six key elements our mortgage experts consider when assessing a mortgage application – these are called the Six Pillars of Lending.

As part of our In Focus updates, we’re focussing on one pillar each week – providing an explanation and using a case study demonstrate how each pillar is assessed in the decision-making process.

This week we’re looking at the Credit History pillar:

We don’t credit score. Instead, we review the client’s credit history in detail. If your client has imperfections on their credit report, please gather as much information as you can and discuss the circumstances surrounding the irregularities with us. We’ll take everything you tell us into consideration.

If there is an irregularity identified and explained to us, we may be able to lean on the strengths of the remaining pillars to hold up the mortgage. We won’t automatically dismiss an application because of missed payments and are ready to understand the explanations for credit issues.

Case Study:
Below we look at a scenario where we were able to provide a solution for an applicant with an imperfect credit score.

• A trainee accountant requested £180,000 for her first residential property
• She had been employed at her firm for 3 months
• She was living in rented accommodation
• The first-time buyer had a few anomalies on her credit report, all during a period where she was travelling abroad and was slow to realise that there were insufficient funds in her bank account to meet her commitments
• The applicant could demonstrate that she had taken action quickly to resolve the issues as soon as she had identified the problem

The applicant had struggled to secure a mortgage due to a poor credit score and because she had only been in her role for 3 months. Having heard the circumstances surrounding the missed payment, we were satisfied that the incident was a one-off. From an affordability perspective, and with our knowledge of the profession, we were happy to accept 3 months’ income as evidence. With no other concerns surrounding the application we were happy to approve this young professional’s first mortgage.

Read about the Six Pillars of Lending.