Frequently Asked Questions
Frequently Asked Questions
Our focus is on great customer service and clear, honest advice for mortgages, remortgaging, first-time buyers and life insurance, so you can feel confident and stress-free.
Frequently Asked Questions
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We’ve pulled together key information you might need from answers to questions, to explaining the different types of mortgages and government schemes that can help you get on the property ladder.
There are many types of mortgages out there – to be honest, it’s far better for us to discuss each with you directly because, once we know your homebuying goals and financial situation, we can explain which we think will fit.
Mortgage Types
Discount mortgages
Discount Mortgages offer a discount on the SVR for a fixed period. These can come with lower exit fees compared to other choices, but unlike a fixed-rate mortgage this will move up and down depending on your lender’s chosen SVR, which can move as the lender chooses, but usually just follows the market.
Fixed-rate
“Fixed rate mortgages are the most common we use for first time buyers, because most like the stability – they know what they’re going to pay,” says Daniel.
A fixed-rate is just what it sounds like: the rate you pay is fixed for the length of the scheme. These monthly costs don’t change during the course of the mortgage scheme. The scheme is often between 2-5 years, but can be longer. We’ll discuss this to ensure you’re picking the right length scheme based on your circumstances.
Offset
Offset mortgages are linked to your savings account (as long as it’s held with the same bank).
Any money you have in your account is offset against mortgage interest.
So, for instance: if you have a £200,000 mortgage, and £50,000 in savings, you’d only pay interest on £150,000 of the mortgage – so cheaper monthly payments, and you have the flexibility to withdraw from your savings if needed (although this will affect your mortgage repayments).
However, most lenders don’t offer offset mortgages, and the ones that do often have higher rates, so it’s usually only worthwhile taking an offset mortgage if you know you’ll have a good amount of savings in the offset account for long periods.
Standard Variable Rate (SVR)
SVR is your lender’s chosen rate of interest – very rarely would you take out a mortgage on this. It’s used when your introductory, discount or fixed-rate deal comes to an end. You’ll almost always want to remortgage before moving onto this, as it’s often far more expensive.
Tracker
The Tracker is a common mortgage type, this typically follows the Bank of England base rate, with a percentage added on top. As this rises or falls, the monthly your interest rate and mortgage payment will change with it.
Moving Home
Can I borrow more when I port?
Yes. It’s common for people to require a bigger mortgage when they port, however, there may still be some problems to solve. If you’re moving to a larger house and you need to borrow more to upsize, you’ll need a ‘top-up’ mortgage on top of the ported balance. This top-up won’t be on the same mortgage scheme as the ported balance.
This means once you’ve purchased the new property, you’ll have two mortgages running alongside one another, with different rates and different end dates.
“If people end up with two mortgages running out of sync, we work out the best route for them to make it as tidy as possible (and save the most money),” says Kye Collier, director of Crescent Mortgages.
“We might place one mortgage on a flexible deal (with no early repayment charges) and put a note in the diary to tidy this up on a specific date in the future when the other part of the mortgage comes to an end, knitting it all together.”
Can I port my mortgage if I’ve recently gone self-employed?
We’ve got a dedicated section around getting a self-employed mortgage, but we wanted to highlight a challenge you might face if you’re thinking about porting a mortgage and have recently started your own business.
The lender, when porting, will conduct another affordability assessment on you, and if you’ve recently gone self-employed and don’t have 2 years of profits to show, this can stop the porting process and force you to go with another lender (or may make it difficult to find a mortgage at all, if you’ve become self-employed within the last year).
We’re here to take you through this – we’ve dealt with many self-employed mortgages over the years, and can explain the options to you and the costs involved simply and without any broker fees.
Can I reduce the amount I’m borrowing?
If you’re downsizing, and don’t need to be borrowing as much money any more (and would like to reduce your monthly premiums) then beware of Early Repayment Charges (ERCs).
If you’re paying off part of your mortgage before your current deal has ended, then you could be liable for ERCs – which could run into the thousands, depending on how long you have left.
If you are going to have to pay out ERCs to move home, it might be worth checking out a new mortgage from a different lender, as you could save a lot of money on your monthly premiums.
At Crescent Mortgages, we handle all kinds of applications and can guide you through the process – with a laser focus on what will deliver you the perfect mortgage for your wallet and needs.
How much can you borrow for your next move?
Here’s the classic mortgage broker answer: it depends. And in this case, it depends on a number of factors.
Property prices may well have risen in your neighbourhood, and you’ll have paid off some of your mortgage. That means you’ll be bringing with you more money to put into a new house, and will therefore be able to afford something more expensive, or get a cheaper house with a smaller mortgage.
The general rule of thumb is: the less mortgage you need to buy a property (in relation to the overall value), the lower the interest rate will be.
Whether you’re porting your mortgage or taking out an entirely new deal, you’ll be subjected to the same affordability criteria as a new applicant.
This means your lender will assess your income and your outgoings to see whether the new purchase can be funded relatively comfortably.
If your income hasn’t risen with house prices, and you’re moving to a much bigger property (and need a bigger mortgage), then that might make you seem less attractive to lenders.
How much Stamp Duty will I have to pay?
Stamp duty, or to give it its proper name, Stamp Duty Land Tax (SDLT) is the tax that the government charges for buying new property. You may have benefitted from discounts as a first time buyer previously, or been under a different scheme when you last changed homes.
Now, when you’re moving home, you’ll have to pay SDLT. There’s no tax on the first £125,000 of the property you’re buying, and then it jumps up through the bands as the cost of the property increases – from 2% after £125,000 to 12% over £1.5m.
If you want to calculate what your stamp duty will be – head over to our calculator! (Link here
What are Early Repayment Charges?
Early Repayment Charges (ERCs) are penalties from the lender for exiting the deal before the agreed end date.
These can be triggered if you’re unable to port your mortgage to the new property, or you want to lower the amount you’re borrowing and want to pay a lump sum early.
These costs can easily run into the thousands if you’ve decided to move a short amount of time after tying yourself into a new deal, and you’ll need to decide if you can afford the extra money it will cost on top of the other moving costs.
What is porting a mortgage?
Porting your mortgage means transferring your existing deal to a new property with your current lender. The main reason people port is because they’re still tied into a mortgage scheme on their current property, which might have early repayment charges if the mortgage is closed early.
First of all, if you’re thinking of porting your old mortgage, you’ll need to find the original terms you agreed to, and see if porting is possible. (If you’re struggling with this – don’t worry, just come to us. We can solve it simply, and what’s more: the service is free).
Although you’re porting an existing mortgage, you’ll still need to go through the same affordability and credit checks as you would a new mortgage – as well as the lender doing a valuation on your new property.
There’s no guarantee that the lender will approve you for a new mortgage, as their criteria might have changed or your circumstances could have altered. So even if porting is allowed, you might not be accepted.
What’s the second-home surcharge?
One thing that can happen when moving home is that you might get stung with additional SDLT (Stamp Duty Land Tax) fees of a further 5%.
This happens if you’ve not sold your previous home on the day of completion for the new property, meaning you own two homes at once. It’s unusual, as most people will sell their current property and buy a new one simultaneously. We’ll talk you through how this works, and the solicitors will oversee the sale and purchase to ensure they complete at the same time.
If for any reason it’s not right for you to sell simultaneously, we’ll discuss if this is possible and the implications this will have on your new mortgage. You’ll have to pay an additional 5% SDLT, as the new place becomes a second home while you technically own two properties.
If the timings of selling your old place and buying a new one are not likely to align, then budgeting for this eventuality is a smart move.
However, the good news is that you can get this refunded when you do sell your old home, provided it’s within 36 months of buying the new place.
Remortgaging
Can I change my mortgage type?
There are a number of different kinds of mortgages out there, and they suit the differing needs of homeowners. You might have been happy on a fixed-rate deal in the past, but want to move to a tracker (which follows the Bank of England base rate).
Perhaps you used a scheme to get onto the property ladder that’s no longer applicable and you want a more conventional mortgage.
“Quite a common remortgage question these days is around how to clear Help to Buy loans,” says Kye.
“This is becoming more popular, because the scheme finished about five years ago, so those loans are starting to gain interest and people want to find a way to change that.”
Alternatively, you might want to lengthen or shorten your deal; whatever the reason, just drop us a line and we can help.
Can I remortgage to release money from my home?
Another reason you might want to remortgage is to make the most of any rises in your home’s value – if it’s increased then the Loan to Value (LTV) (an important measure for lenders to assess risk) will have dropped.
A lower LTV means that the amount you owe will be a smaller percentage of the value of the home, and this can trigger better rates from lenders. This is because there’s less risk on their part if you can’t pay your mortgage and they need to sell your home to get their money back.
You also might want to release some of the equity that you’ve built up – if your home is worth more, you can use that money elsewhere.
However, it’s important to consider this decision carefully, thinking about whether it’s the best choice for your long-term financial situation – for instance, you might end up in negative equity if house prices fall in the future, so it’s important to have a plan in place with how you might cope with that.
Releasing equity and borrowing more will also increase your mortgage payment and could mean it takes longer to fully clear your mortgage.
We’re just highlighting some of the scenarios it’s important to think about – but don’t worry, we can talk you through everything carefully so you’ve got all the information you need to make the right call.
Should I stay with my lender, or find someone new?
If you decide you want to remortgage, it can sometimes be a little more complicated than just going for the best rate.
If you move to a new lender, it can incur some additional fees. This will make it more expensive in the long run, plus you’ll need to go through a few steps to apply and be approved, which will slow down the process.
We can remove that stress of moving to a new lender by handling the application process.
But, first, we’ll also look at what your current lender is offering for you to stay. Sticking with your current lender is usually simpler, can avoid those extra fees and is often a competitive option.“We keep clients with their existing lender a lot. These days, we find it’s actually more common than remortgaging a client to a new lender” says Daniel Pitman, Crescent Mortgages director.
However, sometimes it isn’t that simple, so we always consider the circumstances when making our recommendations to stop people making choices that can cost them a lot in the future.
“Recently, we had a client who was separating from his partner, selling one property and buying another on his own,” says Daniel.
“He was about to lock into a new deal with his current lender on the property he was about to sell, which made no sense, because he’d have tied himself into a two-year fix just to borrow extra to buy her out.
“I took a step back and said, ‘There’s no point remortgaging on a property you’re about to sell – you’re much better off waiting until the sale goes through and using the equity instead’ – that saved him a fair amount in an early repayment charge.”What is a remortgage?
Put simply: remortgaging is changing from one mortgage deal to another, usually to save some money on monthly premiums, and avoid moving onto a much higher ‘follow on’ rate.
Many of you will have at least one mortgage for a large portion of your adult life. During this time, remortgaging regularly – and at the right time – is one of the best ways to keep your mortgage payments down and ensure that you pay back as little as possible over the course of your term.
What’s an SVR? Is it bad?
When your introductory or fixed-rate deal is coming to an end, it’s important to have a look and see what offers are available. If you just do nothing, you’ll be put on your lender’s SVR, which will usually track at varying amounts above the Bank of England base rate.
“The most common reason people come to us to remortgage is because their deal is ending, and they want to avoid the SVR,” says Kye. “They want to shop around first before deciding what to do.”
While the SVR is flexible (meaning you can leave it any time without penalty fees) it’s rarely the best deal you can get, meaning your monthly payments will rise, and there are likely better options out there that we can find for you.
When should I think about remortgaging?
Most mortgage deals will only run for a specific time – mostly two-, three- or five-year deals (although some people lock in for longer).
When this period ends you’ll want to avoid the lender’s Standard Variable Rate (SVR), as moving onto this can cause your monthly bills to rise, and there are often better deals available.
So knowing when your deal ends is key (check your paperwork, or get in contact with us and we can help work this out).
The end of a deal is the perfect time to remortgage as you’re no longer tied into the product and can shop around to get a better deal for you.
That’s where we step in: we use our access to thousands of deals (with some exclusive ones in there too) to find the best mortgage for you, without charging a broker fee.
In terms of exactly when to start planning a remortgage, we suggest 3-6 months before your current deal ends. This allows us time to find the right choice and ]carry out the work involved, making sure it starts at the right time.
Of course, if you’ve got less than three months (or your deal has already ended) give us a ring straight away and we’ll reduce the amount of time that you’re paying more than you need to.
Why should I remortgage?
The most common reason for remortgaging is because your current mortgage scheme is ending, to avoid moving onto a much higher ‘follow on’ variable rate.
If you’re unsure, just give us a call. We’ll help you find out the details you need. There are a few reasons you might want to do this – let’s take you through a few of the most common.
Buy To Let
Are Buy to let mortgage rates higher than residential mortgage rates?
They can be. Buy to let mortgages are priced differently from residential mortgages, and the rate available will depend on things like your deposit, the property, expected rental income and your circumstances.
It’s also important to look beyond the headline interest rate, as arrangement fees can vary considerably between buy to let mortgage products.
Can I get a buy to let mortgage as a first-time landlord?
Yes. You don’t need previous experience as a landlord to get a buy to let mortgage.
Some lenders have restrictions for first-time landlords, but there are plenty of options available. We’ll look at your circumstances and help you find a lender that’s comfortable with your level of experience.
Can I get a buy to let mortgage through a limited company?
Yes. Many lenders offer buy to let mortgages to limited companies, although the rates, fees and lending criteria can differ from buying in your personal name.
There can also be tax implications to consider. We can advise you on the mortgage options, but we’d recommend speaking to a suitably qualified tax adviser or accountant before deciding how to purchase the property.
Can I live in a property with a buy to let mortgage?
No. A standard buy to let mortgage is designed for a property that’s being rented to tenants rather than used as your own home.
If your circumstances change and you want to move into a property you currently rent out, speak to us before doing so. You may need to change your mortgage.
Can I remortgage a buy to let property?
Yes. Just like a residential mortgage, you can remortgage a buy to let property when your current deal is coming to an end.
You might simply want a new mortgage deal, or you may want to release some of the equity you’ve built up in the property. We’ll look at your existing mortgage and compare it with the options available to see what makes sense for you.
Can I rent out my current home instead of selling it?
Potentially. This is often referred to as let to buy.
You may be able to remortgage your existing home onto a buy to let mortgage and then take out a new residential mortgage for the property you’re moving to. There are additional affordability and lending considerations, so it’s worth getting advice before deciding whether this is the right route.
Do I need a minimum income for a buy to let mortgage
It depends on the lender. Some buy to let lenders require you to earn a minimum amount from employment or self-employment, while others don’t have a set minimum income requirement.
The expected rental income from the property is usually an important part of the lender’s affordability assessment.
Do I need a minimum income for a buy to let mortgage?
It depends on the lender. Some buy to let lenders require you to earn a minimum amount from employment or self-employment, while others don’t have a set minimum income requirement.
The expected rental income from the property is usually an important part of the lender’s affordability assessment.
Do I need to own my own home to get a buy to let mortgage?
Not necessarily. Some lenders will consider you for a buy to let mortgage even if you don’t currently own your own home, although you’ll have fewer options than an existing homeowner or landlord and it may not be possible depending on your circumstances.
If you’re a first-time buyer looking to purchase a rental property, speak to us and we can explain which lenders may consider you.
How many buy to let properties can I own?
There’s no universal limit, but your options can change as your property portfolio grows.
Some lenders have limits on the number of mortgaged rental properties they’ll accept, while others specialise in lending to portfolio landlords. If you already own several properties, we’ll take your whole portfolio into account when looking for the right lender.
How much can I borrow on a buy to let mortgage?
Buy to let affordability works differently to a mortgage on your own home. Rather than looking solely at your personal income, lenders will usually want the expected rental income from the property to comfortably cover the mortgage payments.
Each lender calculates this differently, so we can look at the property, expected rent and your circumstances to work out how much you’re likely to be able to borrow.
How much deposit do I need for a buy to let mortgage?
Most buy to let mortgages require a bigger deposit than a standard residential mortgage. Typically, you’ll need at least 20–25% of the property’s value, although this varies between lenders and some may require more.
Generally, the larger your deposit, the wider the choice of mortgage deals available to you.
Should I choose an interest-only or repayment buy to let mortgage?
Many landlords choose interest-only mortgages because the monthly payments are lower, which can help with monthly cash flow. However, you won’t be reducing the amount you’ve borrowed, so you’ll need a plan to repay the mortgage at the end of the term.
With a repayment mortgage, you’ll gradually pay off both the interest and the amount you’ve borrowed each month.
Neither is automatically better – we’ll talk through your plans and help you understand which option is more suitable for you.
Self-Employed
Can I get a mortgage if I’m self-employed?
The short answer is: yes, of course! Some lenders have specialist mortgages for those that are self-employed, but you can apply for mortgages that those in regular employment are eligible for too.
“It’s certainly not impossible to get a mortgage if you’re self-employed,” says Kye Collier, director of Crescent Mortgages.
“There’s a few more bits of paperwork, you need a bit more history, but it’s nothing like the extreme version people imagine. The process is pretty much identical to getting a mortgage when you’re PAYE – it’s just different documents.”
While it used to be true that getting a self-employed mortgage was challenging, in recent years (as the number of self-employed has grown) the market has progressed and lenders now know that being self-employed does not automatically make you more of a risk than other borrowers.
It’s also a myth that you have to automatically pay a higher rate of interest if you’re self-employed. Providing your self-employed income is enough – you’ll have access to all the same rates as an employed person.
The goal is to give any lender confidence that you’re able to afford the mortgage repayments, especially if things like the interest rate or your circumstances change, and that’s where we can help.
How many years of accounts do I need to get a self-employed mortgage?
The general rule of thumb is that you’ll need to have been trading at least two years to be considered for a self-employed mortgage.
This is so the lender can get a good understanding of the profit you’re making, and use that (along with your other income and outgoings) to work out how much you can afford to repay.
However, there are other lenders that will accept a shorter time period – for instance, some will accept 12 months’ trading.
They may also use things like a projection of future earnings and bank accounts to create the profile they need to decide on an application.
We’ve had plenty of experience helping people with all kinds of self-employment histories – and we can usually find a solution.
“One self-employed client of ours had been struggling to find a mortgage. She’d started her own dog-grooming business, but couldn’t get accepted,” says Kye.
“But she’d been employed as a dog groomer for eight years before starting her own business.
“The issue was she’d applied for a mortgage eleven months into her first year. I told her to finish 12 months. She came back with a profit, we put her through a lender we knew accepts a shorter account history, and she got a mortgage offer in three days.”
How much can I borrow?
The size of the mortgage you can get as a self-employed worker depends entirely on your circumstance – but the good news is that it works in the same way as an average mortgage application.
A good rule of thumb is being able to borrow between 4.5 and 5.5 times your annual income, but the exact figure will depend on a variety of things.
Lenders will look at your earnings to understand how much you’re able to afford – this can include things like averaging your income from recent years to get an understanding of how much you can repay.
They’ll also look at your outgoings, working out whether the repayments would be affordable (both now, but also if interest rates were to go up in the future).
It also depends on the Loan to Value ratio (LTV) of the property you’re buying, usually expressed as a percentage.
This works out what percent of the value of the property you’ll be borrowing – lenders will generally give better rates, and are more likely to offer a mortgage, if you’ve got a lower LTV.
Of course, there are other ways to improve the amount you can borrow – such as applying to a more generous lender. In this case, their income is factored in too, meaning the lender is likely to offer you more.
I keep being told I’ll need an SA302 – what is it?
When you submit your Self-Assessment tax return, you’ll be able to access a document that gives your tax calculation, called SA302 or these days may just be called a ‘Tax Calculation’
This will show the total income you’ve received for the year where tax is due, any allowances or relief, the total amount owed for the tax year and how that figure has been arrived at.
Seeing this allows lenders to understand your income given you don’t have payslips. These help confirm what tax you’ve been paying, and will help them assess how much you can afford. You’ll generally need to provide 2 years of these from the most recent period of work.
There are two main ways to get hold of your SA302 tax calculation: through HMRC (either by logging into your account and printing off the document, or calling them up and requesting it by post) or using accounting software – either printed off yourself or by asking your accountant.
We can help guide you through the process of getting your SA302, just give us a shout and we’ll explain the simplest method for you.
What documents will I need?
The good news is that you don’t need to worry about this – we’ll help you find the right documentation, and explain exactly why it’s needed..
Many of the same documents apply to self-employed mortgages as they do to most applicants: proof of identity, address, bank statements and proof of any deposit.
If you’re self-employed, you’ll need your SA302 (the official tax calculation forms from HMRC) and your tax year overview for the last 2 years.
“One of the most common problems we solve is helping people find where to get their documents, such as tax calculations,” says Kye.
“You’ve got to go to the right portals, and because we’re both self-employed, we know where everything is, so we can tell them exactly where to click.”
Depending on what kind of self-employment you’re in, you might also need Certified Accounts from a qualified individual, and if you’ve been self-employed for a shorter period of time, you might need an accountant to verify projected earnings.
If you’re a partner in a firm, you’ll potentially need dividend or profit evidence, and if you’re a contractor or freelancer, evidence of confirmed upcoming work can be useful to demonstrate future income.
However, that’s why we’re here – we’ll walk you through the process and help you get the documents you need in good time. And you can even pop by our offices in Trowbridge to drop them off if that helps.
One of the most common things we help people with – especially those newer to the world of self-employment – is making sure their income is accurate. This can cause issues when going direct to lenders, as some will assume the information is already correct.
“Sometimes self-employed people don’t know their income at all,” says Kye.
“We often say: ‘just send us your accounts, we’ll figure your income out for you.’”
Daniel agrees: “We can usually tell if they’re not 100% sure of their exact figures.
“We’ll get ahead of it and say: ‘do you want to send over the tax calculations and we’ll just take a look?’”
What if I’m a sole trader, freelancer or limited company?
This can vary quite a bit, but that’s why we’re here – we’ve got vast experience in the area of helping the self-employed get mortgages.
“People generally know their salary, as it’s easy to work out: it’s the amount on their payslip times 12,” says Kye.
“But sometimes we’ll see someone who’s self-employed say ‘I earned £40,000 last year,’ when actually that was turnover before expenses, and the actual profit – which is the important bit for lenders – was £20,000.”
Firstly, it will depend what kind of self-employment you’re in. If you’re a sole trader, then traditionally lenders will want to see the last 2 years of your net profit (as in turnover minus expenses) to understand what kind of repayments you might be able to make.
If you’re a partner in a business, you’ll need to prove what share of the profits are yours.
If you’re a director in a company, some lenders will look at your salary and dividends (usually for the last 2 years). Other lenders will focus on the company net profit, which can be beneficial if you took a smaller dividend and left some profit in the business.
If you’re a freelancer / contractor, then it will depend if you’re structured as a sole-trader or Ltd Company.
If you’re a day contractor, some lenders can focus on your day rate rather than company profits, which can significantly increase your maximum mortgage.
“Day-rate contractors are, actually, often on quite good salaries, so we can end up finding them a decent-sized mortgage,” says Daniel Pitman, director of Crescent Mortgages.
“It doesn’t matter whether they’re on a day rate, inside or outside IR35 (the tax rules used by HMRC to define whether someone self-employed should be classed as an employee), under an umbrella company, or through a limited company.
“Actually, a contractor through a limited company is one of the few types of self-employed person assessed differently to a normal director, who’d normally need two years’ accounts. Often a contractor can be assessed more favourably.”
Having evidence of signed contracts for future projects can help here, as well as any explanations of gaps in your work history.
Life Insurance
Can you review life insurance or protection I already have?
Yes. If you already have protection in place, we can review your existing policies alongside your current circumstances. We won’t recommend replacing existing cover unless we believe there’s a good reason to do so, and we’ll explain the advantages and disadvantages before you make any changes.
Can you review life insurance or protection I already have?
Yes. If you already have protection in place, we can review your existing policies alongside your current circumstances. We won’t recommend replacing existing cover unless we believe there’s a good reason to do so, and we’ll explain the advantages and disadvantages before you make any changes.
Do I need protection if I already have cover through work?
It depends on the benefits your employer provides and whether they would be enough for your needs, but often it’s sensible not just to rely on work benefits. Workplace benefits can be valuable, but they may change or end if you leave your employer. We can review any cover you already have and take this into account before recommending whether you need anything additional.
Do you charge a fee for protection advice?
No. We don’t charge you a broker fee for our protection advice or for arranging your policy. If you take out a policy through us, we’ll normally receive commission from the insurance provider in the same way every broker is paid, however, we choose not to charge you an additional fee on top.
How much life insurance do I need?
There isn’t one amount that’s right for everyone. You might want enough cover to repay your mortgage, provide for your family, replace lost income or cover other financial commitments. We’ll look at your circumstances and what you’d like the policy to achieve before recommending an appropriate level of cover.
What is family income benefit?
Family income benefit is a type of life insurance that can provide your family with a regular income if you die during the policy term, rather than paying the entire amount as one lump sum. It can be a useful way of helping to replace your income and support your family with their ongoing living costs.
What is income protection?
Income protection is designed to provide you with a regular income if you’re unable to work because of illness or injury. Policies can vary considerably in how much they pay, how quickly payments begin and how long they can continue for, so we’ll help you understand the options available.
What types of protection can you help with?
We can advise on a range of personal protection, including life insurance, critical illness cover, income protection and family income benefit. These policies are designed to protect against different circumstances, and you may benefit from a combination of cover rather than relying on one policy alone. We’ll explain the differences and recommend what we think is appropriate for you.
What’s the difference between life insurance and critical illness cover?
Life insurance pays out if you die during the policy term, whereas critical illness cover can pay out if you’re diagnosed with one of the serious illnesses covered by your policy and meet the insurer’s definition. The conditions covered and definitions can vary between insurers, which is one reason getting advice can be valuable.
Important Info
Might I be rejected for a Mortgage in Principle?
“It’s rare that we’d ever outright decline someone for an MIP”, says Daniel. “The most common issues we get are people not being able to borrow as much as they wanted, or not having enough deposit.”
Once you’ve got your MIP through us, you’re now armed with accurate information on what you’re likely to be able to borrow and can get started with finding your perfect first home
What counts as a first time buyer – am I eligible?
It sounds pretty simple – and for most people, it will be. You’re a first time buyer (FTB) if you’ve never owned a property to live in before (and this includes inherited homes).
The property you’re buying must also be for you to live in as your primary residence (i.e., you’ll live there most of the time).
If you’re buying your first home with other people, you’ll need to check if they’re a FTB – this will have an effect on the kind of mortgage you can get and other fees like Stamp Duty.
What does “no broker fee” actually mean?
The way we get paid is simple – if we help you get a mortgage, we get what’s called a ‘procuration fee’ from the lender. This doesn’t impact what you pay, and is just a small percentage of the mortgage paid to us from the lender for bringing them a new client, and overseeing the application & paperwork for them.
So it’s in our best interest to get you the right mortgage, and get to the finishing line as smoothly as possible, otherwise we don’t get paid.
Brokers that charge a fee on top also receive this procuration fee so are getting paid twice – we’re happy with just the once. There’s no catch!
What is a Loan to Value ratio (LTV)?
One of the key principles of getting a mortgage is this: the less you need to borrow to afford a property, the better. The size of your deposit, compared to the amount you have to borrow, is known as the Loan to Value ratio, which is expressed as a percentage.
Let’s say you’ve got £15,000 saved. If you used that to buy a £150,000 house, you’d have a 10% deposit and your LTV would be 90%.
If you used that £15,000 to buy a £300,000 property, you’d have a 5% deposit and an LTV of 95%. Generally speaking, the lower you can get the LTV, the better rates we’ll be able to find for you, so the more you can put into a deposit (without causing yourself financial stress), the better.
Government Schemes
First Homes scheme
The First Homes scheme is for new homes that cost under £250,000 (or £420,000 in London) and for those earning under £80,000 a year (£90,000 in London).
It means you can find an eligible new build property and get between 30-50% off the purchase price.
“The First Homes scheme isn’t something we see getting used very often – it’s quite rare,” says Kye Collier, director at Crescent Mortgages, highlighting the complexities of ownership and the specific criteria needed to be eligible.
When it comes to selling, only someone else eligible for the First Homes discount can buy it, and you pass the savings onto them. If you can’t find that after a certain period of time, you can sell it on the open market, but must return the same percentage of savings you got at purchase to the council.
Lifetime ISA
A Lifetime ISA, or LISA, is available to those between 18 and 39, and allows you to save up to £4,000 a year into a savings account, and the government will add a further 25% onto the total.
“We see loads of first-time buyers using a LISA, which makes sense because it’s just extra money to help with your contribution,” says Daniel.
These savings can only be used for buying your first house up to the value of £450,000 (or saving for retirement) and you have to have the funds in place for at least 12 months before you can use them for the purchase.
You can combine with another LISA saver when buying a property, meaning you could have saved a significant amount towards a deposit if you’re doing it for years before purchase.
Be warned that you’ll be stung by a 25% withdrawal penalty if you take the money out for any reason other than the above.
One other issue to be aware of: the limit of £450,000 has been frozen for nearly a decade. During that time, the cost to the average first-time buyer in Bath has risen to an average of £331,000 on their first home (as of May 2026), and less in the surrounding areas – so while still under the cap, those looking to spend more on their first property might find this level restrictive.
Shared Ownership
A lot of people ask ‘what is shared ownership?’ because it doesn’t really explain itself well.
It’s where the council or a housing association will own a portion of the property, and you the rest (usually between 25% and 75%, although some will take more). You’ll have to get a mortgage on the amount you owe, and pay rent for the portion you don’t own.
This rent is reduced compared to market rates, and allows you to get a foot on the property ladder. However, you may have to pay service charges and ground rent, as shared ownership properties are usually leasehold (where you buy the right to live on the land your home is built on, but you do not own the land).
“Shared Ownership schemes are more for people who can’t buy without it. Because you don’t own the full property, it’s not always ideal for everyone,” says Daniel.
Over time, you can work towards owning 100% of the property through a system known as ‘staircasing’, although this can come with extra costs (like administration fees) depending on how much you buy each year.
Extra Costs
What are legal / conveyancing fees?
You’ll need to hire a conveyancer (a type of solicitor) to handle the legal work for you. They’ll undertake necessary legal work, like local authority searches and perform the necessary steps to oversee the legal transfer of your property.
Their charges will vary depending on what work they’ll need to do, but you can discuss this ahead of time. Like all the fees, we can help you understand what you need to do and help you through the process.
What are mortgage arrangement fees?
When taking out a mortgage, lenders can charge a mortgage arrangement fee. These can range from a few hundred pounds to over £1,500, and sometimes will vary on your headline mortgage rate. We’ll only recommend a scheme with a fee if it gets you a lower interest rate which means the scheme will be cheaper overall.
These don’t have to be paid upfront – they can usually be added to the cost of your mortgage – but more interest will be paid on the higher amount over the course of your borrowing.
What is stamp duty?
When you’re buying your first home, there are more costs than just the purchase price – the biggest you’ve probably heard about is stamp duty.
Its full name is Stamp Duty Land Tax (SDLT), and it’s a tax paid to the government when purchasing your home. However, there’s a part of the scheme that’s designed to help first-time buyers, by removing SDLT for any home they buy up to £300,000.
However, in Bath the average house price for a first time buyer (as of May 2026) is £331,000.
Those paying that price will need to pay SDLT (5%) on the balance above £300,000, so it’s worth factoring that into the amount you’ll need to save for.
Other properties, such as in Trowbridge, Warminster and Melksham, are usually cheaper for first time buyers, and on average they won’t have to pay SDLT.
If you want to work out what your stamp duty will be in England – head over to our calculator
What’s a booking fee?
Some lenders will charge a fee to secure a specific deal, and may be non-refundable, even if you don’t take out their mortgage for whatever reason. These can range from £100 to £300, so should be taken into account.
However, these days, most high street lenders and larger building societies don’t include up front booking fees – so they’re very rare.
What’s a mortgage valuation fee?
These are where the lender charges for someone to check the value of the property you’re buying, to be sure that it’s worth what you’re paying. These fees can sometimes be covered by the lender, but if you do have to pay for this, it’s usually no more than £100.