Affordable Homes Schemes
Tai Clwyd administer several schemes which can assist you in buying or renting a home, and offer assisance to families through the mortgage rescue scheme.
Homebuy
Homebuy is a government-backed scheme that is supervised in Wales by the Welsh Government. Funding is limited; currently homebuy funding is only available in Conwy County Borough Council. Funding is not currently available in the counties of Wrexham, Flintshire and Denbighshire, however this could change as the financial year progresses. Read More …
Shared Equity
Shared Equity is usually offered on brand new properties purchased direct from a developer, or a second hand property previously bought on shared equity from a developer. Sometimes shared equity is offered by housing association or local authorities on their own properties. Read More …
Shared Ownership
Shared Ownership is usually referred to as “part buy, part rent”, you buy a share of a property owned by Tai Clwyd, and pay rent to Tai Clwyd on the share that you do not own. Read More …
Important Information For All Schemes :
PURCHASING COSTS
It is important to consider the costs of purchasing your own home as well as the costs associated with being a homeowner.
Initial Costs
You will probably require a minimum of £2,000 to meet these costs. Costs vary between solicitors and mortgage lenders.
Legal Fees:
Solicitors Fee: this is for the basic legal work that they will do on your and your mortgage lenders behalf.
Land Registry Fee: this registers you as the owner of the home at the Land Registry as well as any mortgages or loans (known as Charges) that you have taken out in order to buy it.
Environmental Search Fee: this shows any planning applications made on the property you are buying and also any planned developments that may affect your home.
Disbursements: your solicitor will charge for any administrative work that they undertake on your or your mortgage lender’s behalf. This includes bankruptcy searches or telegraphic transfer fees.
Stamp duty: stamp duty is exempt for first time buyers until 24 March 2012 if you purchase a property under £250,000, after 24 March 2012 you will have to pay 1% stamp duty on any property costing over £125,000, however, some areas are exempt from stamp duty.
Mortgage and survey costs:
Deposit: 5% deposit on the % share you purchase.
Mortgage Arrangement Fee: most mortgage lenders charge an administration fee. This fee will usually vary according to which type of mortgage you choose. You should only have to pay one fee. If you are using an Independent Financial Advisor they should not charge you a separate fee as they are paid by the mortgage lender with whom you place your mortgage with.
Valuation & Survey fee: no matter which type of property you buy your mortgage lender will require you to have a valuation survey carried out so that they can be sure the property is suitable for them to lend upon.
Costs of being a homeowner
- Mortgage repayments (and rent on shared ownership scheme)
- Mortgage payment protection in case of unemployment or illness
- Life Assurance
- Building and contents insurance ( contents only on shared ownership scheme)
- Repairs and maintenance
- Service charges if purchasing a flat
- Services – gas, electricity, water, council tax etc
- Council tax – if there is only one adult living on the property, you can claim 25% discount off your annual council tax bill.
Further information in the costs of running a home that you own can be found in a number of consumer magazines or books, or on the internet. Here are some examples of useful websites:
http://www.yourmoney.moneyadviceservice.org.uk
http://www.thisismoney.co.uk
http://www.slhdmoneywise.co.uk
http://www.moneysavingexpert.com
http://yourmoney.moneyadviceservice.org.uk/tools/mortgage_calculator.html
We strongly recommend that you seek independent mortgage advice from an Independent Financial Adviser, however please see our tips below.
MAKING A MORTGAGE APPLICATION
A mortgage is a loan secured against your home. You would usually repay your mortgage over a 25 or 30 year term. If you do not keep up the repayments, the mortgage lender can sell your home to get its money back.
The mortgage must be obtained from a building society, a bank, a friendly society or an insurance company. Do not incur any costs in relation to obtaining a mortgage until the lender offering to provide the mortgage has confirmed that it is one of these types of lender.
The type of mortgage you take out must be a repayment mortgage. There are different types of mortgages available:
- Standard variable rate (SVR) mortgage
- Fixed-rate mortgage
- Base-rate tracker mortgage
- Discounted variable-rate mortgage
Please see below some useful tips on making a mortgage application.
To obtain an idea of monthly mortgage repayments there are a number of online mortgage calculators such as http://yourmoney.moneyadviceservice.org.uk/tools/mortgage_calculator.html
TIPS ON MAKING A MORTGAGE APPLICATION
DON’T ASK TO BORROW TOO MUCH
Trying to borrow more than is realistic will delay the application process and could lead to you being denied a loan. Most lenders have affordability calculators on their websites, which will give you a rough guide to how much you can borrow. You don’t need to provide your name or address, but you do have to enter personal details about how much you earn and any outgoings that you have, such as loan and credit card payments.
Many lenders look at affordability model, as opposed to a simple multiple of your income. Credit cards and loan repayments affect the amount that you can borrow. Aim to pay off your existing debts, especially credit card debts before applying for a mortgage.
EXPLAIN ANY DISCREPANCIES ON YOUR BANK STATEMENT
Banks and building societies will examine your bank statements in detail. Any missed or late payments or unusual activity could result in an instant rejection. If there is anything that needs explaining that wasn’t your fault, ask for a letter from the parties involved.
BE ORGANISED WITH YOUR PAPERWORK
Keep bank statements, pay slips carefully. Most lenders will need at least three months’ pay slips and three months’ bank statements. Online bank statements are not acceptable because they can be doctored easily; therefore you need to ask for hard copies from your bank. You will also need proof of your identity and address. If the lender asks for particular documents, try to send everything together with the application to avoid confusion.
MAKE SURE THAT YOU PROVIDE PROOF OF DEPOSIT
Most lenders will require a 5% deposit, the larger deposit you have the better your mortgage interest rate. Showing that you have money sitting in an account may not be sufficient for all lenders, you may be asked to provide proof of how you built up your deposit.
Complete a clear paper trail of where you have raised your deposit from, or include a letter if the money is a gift from a family member. This proves to the lender that the money has been saved, earned or offered as a gift, not borrowed.
BE HONEST ABOUT YOUR INCOME AND BONUSES
The income declared on your application should match exactly what appears on your pay slips and P60. If you rely on income above your basic salary, such as bonuses or commissions, it should be evident on pay slips and P60’s. Many lenders do not include annual bonuses in income calculations, so additional income needs to be regular if it is to be taken into account.
CHECK YOUR CREDIT REPORT AND THAT YOU ARE ON THE ELECTORAL REGISTER
Lenders examine your credit report in detail, and this document will also show whether you are on the electoral register. If you’re not on the register and you have a poor credit rating, you may not be able to get a mortgage.
If there are any errors on your credit report, you can file a notice of correction. You can access your credit report through any of the credit references agencies: Experian, Equifax and Callcredit. To find out if you are on the electoral register, ask at your local council. You can also sign up online at aboutmyvote.co.uk.
