Blue Q Mortgage

An interest only mortgage will allow you to make monthly payments just to cover the interest on the money you have borrowed. Unlike a traditional repayment mortgage where payments consist of both capital and interest, with an interest-only mortgage, you will only pay the interest and the balance of the loan will therefore not decrease.

There are various reasons why an interest only mortgage may be appealing:

1. Lower monthly payments: this means the loan would be more affordable on a monthly basis
2. Short-term purchase: the borrower may be planning to sell the property in the short term and downsize to a cheaper property
   
3. Investment purposes: the borrower could be planning to invest the money that would be used to pay the capital payments elsewhere

Risks and considerations

1. Balance of mortgage will remain outstanding at the end of the term: as you are only paying the interest on the mortgage, the mortgage balance will remain the same and will be repayable at the end of the term
2. Equity Building: as no capital is being paid during the term of the mortgage, the equity for the borrower will not increase unless the property value increases. This means they may have less equity available for the future, which could be problematic if the value of the property decreases
   
3. Interest Rate Adjustments: if the interest rate loan is variable, borrowers may find their monthly payments increase if mortgage rates rise
4. You will not fully own your own home at the end of the term: A lender will require you to pay the mortgage balance at the end of the term.  This may mean you need to sell your property to repay the loan
5. Investment Returns: if you choose to invest your capital repayments in an investment policy, the growth may not be enough to repay your mortgage at the end of the term
   
6. Part interest only and part repayment: Many lenders will offer a two-part loan which means you can have part of the mortgage on interest only and part on repayment. This allows you to build up some equity in your property whilst keeping your monthly payment low

Interest-only mortgages may not suit everyone, and it is important to fully understand the terms, risks and long-term financial implications.

Our friendly team of professionals are on hand to answer any of your concerns, so please do not hesitate to get in touch: 01245 218018 or team@blueqmortgage.com.

‘Mortgage prisoners’ are people who are unable to switch mortgages to a better deal, despite being up-to-date with their mortgage payments.

Where does the name come from?

As the name suggests it is a situation where homeowners are ‘trapped’ in their existing mortgage, unable to switch to a deal with better terms, or rates. The term ‘mortgage prisoner’ surfaced during the financial crisis of 2008.

How does someone become a mortgage prisoner?
Mortgage prisoners often arise due to a combination of factors such as changes in economic downturns, lending practices, and regulatory constraints.

Below are a couple of scenarios which could lead to a borrower becoming a mortgage prisoner:

1. High Loan-to-Value (LTV) Ratio: if you have taken out a mortgage with high LTV ratios, which means you borrowed a large portion of the property’s value. If the value of the property declines, or if your financial situation deteriorates, you may find yourself in a position where you owe more on your mortgage that the property is actually worth. This can make it difficult to refinance or switch lenders.
2. Tightened Lending Criteria: following the financial crisis, lenders have implemented stricter lending criteria, making it more difficult for borrowers to secure new mortgages. This means, some existing homeowners who were previously able to get a mortgage do not meet the new criteria when trying to switch to a new lender or negotiate terms.

Unfortunately, mortgage prisoners may be stuck with higher interest rates and unable to benefit from any lower interest rates on the market. There are regulations and policies in place which provide initiatives to provide relief and potential solutions for those affected and facing financial hardship.

Out team will be happy to talk further about Mortgage Prisoners with you. Our friendly team of professionals are on hand to answer any of your concerns, so please do not hesitate to get in touch: 01245 218018 or team@blueqmortgage.com.

There are several potential sources you can consider when it comes to getting together a deposit to buy a property. Providing proof of the source of your deposit is a key requirement in the application process and will need to be given to both the lender and the solicitor.

Each mortgage lender will have their own criteria as to what they deem as an acceptable source of deposit. These include:

• Personal savings

This is the most traditional and straight-forward way to fund a deposit for your home deposit. Lenders are happy to accept deposits funded by the applicant’s personal savings, although they may want to see bank statements to show the balance increasing over time.

• Inheritance

Lenders are usually fine to accept a deposit funded by inheritance you may have received. You will be required to share legal documents from the Will’s Executor showing details of the amount, as well as evidence the money in your account.

• Gifted deposits

Most mortgage lenders are happy if your deposit was gifted to you by a close relative. Some lenders even allow gifts from friends or more distant relatives. You will need to provide a signed legal agreement declaring that the money does not need to be re-paid.

• Deposit from selling a property

If you are already a homeowner and you are moving home, you may be using the “equity” in your current property as a deposit for your new one. The solicitor will deal  with this for you when the sale and purchase complete.

• Equity from another property

If you own another property, you may have enough equity to be able to release by way of a re-mortgage to make up a deposit to buy another property.

• Gifted Equity
  Some lenders allow family members or associates selling property to gift some of the equity to the buyers, in leu of a cash deposits.

Landlords are now able to gift equity to tenants as part of a mortgage transaction, so be sure to ask if this is an option if you landlord is selling

• Government schemes
  There are government-backed schemes on offer, this includes the First Homes scheme where the deposit required is a minimum of 5% of the discounted purchase price. This has been introduced in a bid to get first time buyers on the property ladder by offering a lower deposit and a 30-50% discount on the house itself.
• 100% Mortgages

Finally, if you simply cannot raise funds for a deposit, it looks like 100% mortgages are returning – so you may not need one anyway!

If you have further questions about mortgage deposits, please get in touch with our team of experts.

Are you moving into a new home soon? Despite being very exciting, it can also be an incredibly stressful time trying to pack all your belongings, book moving vans, and tie up any loose paperwork such as bills and change of address. Check out our list of tips to get you ready for the big day.

Start packing early

Quite often the thought is worse than the deed! If you break it down into smaller tasks, such as focusing on a room at a time or packing away items you definitely won’t be needing, it can feel a lot less daunting. Alternatively, you can always pay someone to pack up your house for you!

Disassemble furniture in advance

Disassembling anything that may not fit through the door in advance, will save you a lot of time and stress on moving day.

Have a clear-out in advance

You’ll have enough to take with you so you don’t want to be taking anything you don’t want to keep. It can be quite satisfying to clear unwanted belongings and donating them to charity – of throwing anything that is no good!

Who will be helping you move

Depending on your budget and how much you need to move, you’ll need to figure out which service you require – do you have friends or family to help you, or will you be relying solely on a man and a van? It is always good to book vans in advance and shop about for the best quote offering the best service to suit your needs.

Boxes and labels

Large zipped laundry bags are inexpensive and great for moving linens, shoes, and clothes. Labelling boxes may sound very obvious but clearly marking boxes will make life so much easier when you come to unpack them.

Which room?

Create an inventory of furniture and mark which room it will be going in – this makes it easier for those moving heavy, bulky items. It will also determine whether your furniture will fit through the doors!

Essentials box

Packing the kettle, tea, coffee, and loo roll last will mean you will unpack this first – these are likely to be a necessity when you arrive! It’s worth keeping remote controls, phone chargers, and anything you may need to find quickly in the same box. Be sure to keep jewellery and valuables in a safe place.

Make your bed

Knowing where your linen is and making your bed early on, will mean you can crash at the end of the day without having a further job to do before you can relax! You have made it to your new home, you can now relax and take time to unpack the rest of the boxes!

Times are tough at the moment with the rising cost of living such as energy bills, food, and petrol. We’ve come up with some tips to help you save a few pennies. Even if you’re not feeling the strain, it is always good to put some of these into practice.

1) Budget
Keep a monthly budget to track your spending and set a limit. This will allow you to see your income, outgoings, spending habits, and understand your overall financial position.

2) Eat In
Keep eating out for special occasions and try cooking at home as much as possible as it can be a cost-effective way to save money. Go one better and plan your meals in advance buying ingredients in bulk where you can save money.

3) Reduce Energy Usage
Turn down your thermostat, turn off lights when you leave a room, and use energy-efficient appliances as reducing energy usage will reduce your monthly utility bills. Also, switching appliances off standby can save around £40 a year.

4) Shop for Deals
Be sure to look for deals in the supermarket, offers on the high street, and voucher codes/ money-off coupons when shopping online to get the best deals. It’s also worth seeing if you can lower your phone bill, or broadband by contacting your provider and haggling for a better deal.

5) Subscriptions
Take a look at your subscriptions and see if you can cut back on any of those you don’t currently use or need. This could be streaming services, magazine subscriptions, and gym memberships.

6) Entertainment
Now more than ever we don’t want to lose doing things that bring us joy. However, there’s no harm in getting creative when looking for entertainment options, this could include; visiting local parks, attending community events, or having a games night!

7) Mortgage
If you don’t have an early redemption penalty to pay – contact us straight away to see if we can save you money on your mortgage payments. Despite the turbulence in the market – mortgage rates are currently falling. Call us on 01245 218018 or email team@blueqmortgage.com.

8) Insurance
Make sure you are getting the best deal on your insurance policies. Contact your car and Pet insurers to see if they offer discounts for existing customers. 

When you’re looking to buy a home, and you own a car, you ideally want to know you’re going to be able to park your car either on your own driveway or at least close enough so that you don’t have to walk two miles carrying a week’s food shopping!

Parking rules can be confusing, even for the most experienced of drivers! This is why we have written this blog to help you and prevent any nuisance parking.

On-street parking

Be sure to look for signs and information on your local authority’s website as this will indicate whether you are in a Controlled Parking Zone, a Restricted Parking Zone, or you have the freedom to park there.

Permit holder only

Some streets only have parking for residents who hold a permit, or a temporary visitor permit. These rules may be 24 hours a day, or they may be for set periods during the day. There will be signs nearby to establish whether you can park there or not.

Can you park on a dropped kerb?

Dropped kerbs are there for a reason – to improve access for:

• Pedestrians – particularly those using wheelchairs or mobility issues, as well as people with limited sight
• Vehicles – for those entering or exiting a driveway

The Highway Code states that you must not park where the kerb has been lowered.

Can you park opposite a dropped kerb?

As long as it is safe to do so and vehicles can get in and out of their driveways easily you are allowed to park opposite a dropped kerb.

 Can you park in front of a driveway?

Parking in front of a driveway is sure to upset the neighbours! Often there will be dropped kerb in front of the driveway to enable vehicles to access them, which as we have already read is a no-go. Even if a driveway doesn’t have a dropped kerb, you should still avoid blocking it, again for visitors who have mobility issues or young children, unless you have permission from the occupiers.

Can you park on someone else’s drive?

It is a civil offence of trespassing on private property if you opt to park on someone else’s driveway unless you have been given permission to park there. Although it is not a crime (civil matters are enforced in different types of courts), so the police aren’t likely to get involved. Also, if your vehicle is taxed and insured you won’t be classed as an ‘abandoned vehicle’ so the council may not help either. But technically you get sued and most definitely ruffle some feathers!

Of course, it’s always good to refer to the Highway Code (rule 239) for any confusion on parking, but a lot of the time sensible parking comes down to common sense!

Selling your house can be a stressful time, there are several key tips you can do to help maximise your chances of selling successfully.

• Improve curb appeal

Invest some time and effort in enhancing the exterior of your home – ensure the lawn is mowed, garden maintained and the front of the house is clean and tidy.

• Make necessary repairs

Address and fix any obvious maintenance issues before listing your home. Repair any broken windows, cracked tiles, or leaky taps! A well-looked-after home will give the buyer confidence.

• Stage your home

Be sure to showcase your home’s best features. For example, arrange furniture in a way that maximises space and lets plenty of light in. You could even hire a professional home stager.

• Declutter and depersonalise

Remove excess clutter and personal items – buyers want to be able to envision them living in the house. Keep the décor neutral, organised, clean, and welcoming.

• Price it right

Overpricing can put buyers off, while underpricing may result in lost revenue. It’s important to set a realistic and competitive price for your home based on its condition, location, and market trends. Consult an estate agent for guidance.

• Market effectively

Make sure you use different channels to market your home. Include online listings, professional photography, virtual tours, and social media platforms as this will gain a larger reach and wider audience. Ask your Estate Agent about their marketing approach.

• Highlight unique selling points

Identify and emphasise the unique features and benefits of your home. Showcase any recent renovations, energy-efficient upgrades or desirable amenities.

• Be flexible with showings

Try to accommodate potential buyers’ schedules by being flexible with times – the more accessible your home is for viewings, the higher the chances of attracting serious buyers.

• Respond promptly

Answer enquiries quickly, or any communication related to the sale – this shows commitment and professionalism.

• Negotiate wisely

Be prepared for offers or counteroffers. Work closely with your Estate Agent to evaluate each offer and consider various factor beyond the sale price.

One last tip – remember to have your mortgage agreed so that you are ready to move. Selling a house can take time, so be patient and remain proactive and responsive throughout the whole process.

We are often asked if it’s good advice to consolidate “unsecured” debt (credit cards and loans etc) into your mortgage, the answer is, sometimes.

As long as you have sufficient equity built up in your property, you can borrow additional funds to pay off any of the following:

• Loans
• Credit cards
• Hire purchase agreements
• Overdrafts
• Student finance

This would typically be by either re-mortgaging to a new lender and increasing your loan amount or taking a further advance from your existing lender. If neither of these are possible you may be able to arrange a second charge loan from another lender

It is true that paying off credit and adding it to your mortgage will reduce your monthly income initially. However, before you go ahead it is very important to go through each item of credit with your Mortgage Adviser and ask them to calculate how much it will cost you overall if you consolidate it into the mortgage vs how much it will cost if you leave it as an unsecured debt. This will help you to decide what to consolidate and what to leave as it is.

As a rule of thumb, any credit with a balance under £1,000 or where there are less than 12 months remaining on the term should not be considered, as this is not good advice!

The main benefit of taking this course of action is clearly that it will reduce your monthly outgoings. As well as this, the interest rates on secured borrowing are typically much lower than on unsecured borrowing and you will only have one payment to manage.

On the downside, additional secured borrowing puts your home at greater risk if you become unable to make the repayments and you will likely be making repayments for longer as you are spreading the costs over a longer-term

I want to re-mortgage, what do I do next?

If you feel that debt consolidation into a mortgage is for you, you’ll want to compare a range of lenders. The best way to find the most suitable deal for your personal circumstances is to seek help from a mortgage broker. This is where we can step in and guide you through the process. Our friendly team of professionals are on hand to answer any of your concerns, so please do not hesitate to get in touch: 01245 218018 or team@blueqmortgage.com.