Mortgage in the UK.
When issuing a mortgage, the bank will consider whether you are a citizen of the country or not. You get a loan depending on your creditworthiness, check your credit rating. The decision on the amount of the loan will be based on the amount of your annual income, for example, your annual income is 30,000. then you will receive a loan of about x4 or x 5mah. ( 30000X5 = 150,000.)
Mortgage in the UK.
Carefully choose and check the bank-creditor bank for reliability. Before signing a loan agreement, read it carefully. When registering a loan agreement, you, as a borrower, should be interested in the following issues:
Interest rate. Terms and amount of loan repayment. Penalties for delay. Commission for making a debt. Bank fees - the amount charged by the bank from the client for the performance of certain transactions: - keeping the account (% of the loan amount monthly), - monthly money transfers. Find out if the bank has the right to raise the interest rate and how often it can do it. Some banks accept payments for several months in advance, so that later they do not have to worry about it.
It is necessary to clarify what percentage goes in general, with all commissions, and then employees say 19% per annum, in fact, with all commissions for account maintenance, insurance and the like will be 50%.
Mortgage for non-residents of Great Britain:
For many Russians who learn that buying an apartment or a house in the UK is possible in a mortgage, it becomes a revelation that provokes sincere surprise.
Indeed, getting a mortgage loan to a Russian citizen is not easy even in your own country. But even more surprising among people who are far from the world financial problems is the size of the mortgage interest rate when obtaining a mortgage by individuals buying UK residential property. This is approximately 4.5% & # 8211; 5.5% per year for non-residents (that is, for non-citizens of the United Kingdom).
The mortgage rate may be "floating", that is, tied to the refinancing rate of the Bank of the United Kingdom, approximately: the Bank rate + 1-3%. The rate can be fixed - that is, it will be constant throughout the duration of the contract. For residents, the rate is usually even less.
If you compare with the interest rate under a mortgage agreement in Russia with Russian banks, it will be about 13% -15%. The difference is really significant. In fact, there is nothing surprising. The term "mortgage" takes its origins in ancient Greece and means that mortgage property is the subject of a mortgage.
In the United Kingdom, the United States, and Australia, the word "mortgage" is used to designate a mortgage. A curious fact. This word comes from French law and means "mortal pact". The very fact of granting mortgage lending by UK banks to foreigners buying real estate in the UK is easy to explain. After all, if you lose your solvency, the bank will always remain in the mortgage of your property, which you can sell, covering your debt to the bank. In addition, the Government of the United Kingdom has always sought to create a favorable investment climate, creating a set of measures to attract foreign investors. Mortgage lending can be obtained, and investing in a new building located on the territory of England.
What you need to know in order to get a mortgage to buy residential property in the UK:
You can count on a mortgage in the UK, if you are a non-resident, only if you have at least 40% of the cash on the down payment. You must provide for additional costs associated with the preparation of a loan agreement, real estate valuation by an independent appraiser, legal services and brokerage services. To assess the probability of obtaining a loan, you will need to confirm the annual income, approximately equal to the amount, 3-4 times less than the entire loan amount. For example, to obtain a loan of 100,000, you need to confirm an annual income of 30,000.
What documents will be required to provide:
Confirmation of your permanent residence. In the UK there is no concept of "registration". To confirm your place of residence, you will need utility bills for the last three months.
2. A document confirming your income. This can be a tax return, a certificate from the place of work with proof of income, you will necessarily need to provide an extract from your current account for the last 6 months with the reflection of the account movement in it.
Also, to confirm your income, you may need an independent audit company's report on your financial condition. The report can be compiled by a company included in the list of the largest international audit companies and having a representative office in Russia. Usually, the bank itself recommends you the name of this reputable company, which causes the bank's trust. You must prove that you have the means to pay the down payment & # 8211; usually for this purpose there is enough an extract from the bank with the indication of the balance on the account.
It should also be noted that in the UK you can take a mortgage on two conditions:
1. Repayment of the mortgage & # 8211; in this case, monthly it is necessary to pay both the principal amount and interest. However, the size of the principal debt and interest on it is gradually decreasing.
2. Interest-only-mortgage - in this case only percentages are paid monthly, the amount of the main debt is capital & # 8211; remains unchanged. The amount of the principal debt is paid on a lump sum basis after the end of the term of the mortgage loan, or the real estate is sold.
There is also the concept of "buy to let mortgage" & # 8211; in the case where you acquire a residential property in a mortgage for commercial purposes - that is, in order to receive rental income. With a proper calculation and the correct choice of the investment object, your monthly payments under the mortgage agreement will not only be covered by rent payments, but you will also receive a small monthly income.
Specialists of our company will help you to understand on what conditions it is preferable to get a mortgage loan for the purchase of real estate in the UK, will consult on issues related to the preparation of documents for obtaining a loan. And in case you intend to purchase a property in London for commercial purposes - to lease it, we will help you find the most attractive property for investment.
You can try to obtain a mortgage loan in two ways:
Receive a loan through a consultant / broker (when it is once sorted out). In this case, you may not have to pay anything to him. The bank will pay him, but of course it will be included in the cost of the loan in a hidden way. The most direct and receive the loan is the cheapest option at that time. Now the difficult times, it's better to figure out what's going on in such a complex product as a mortage. When issuing a mortgage, the bank will consider whether you are a citizen of the country or not, but whether the loan is issued or not depends on your creditworthiness and your credit rating, and your employment will be very important. The decision on the amount of the loan will be based on the amount of your annual income, for example, your annual income is 30,000. then you will get a loan of about x4 or x5mah. ( 30000X5 = 150,000.) A year ago you could 100% credit, without a down payment. At the moment, this is not realistic. The bank will request a mandatory contribution of mines of 5%, and ideally 10%.
C Are there any services that help in preparing the necessary documents for the receipt of a mortgage in the UK?
In the Bank, loan officers are engaged in consultations of borrowers, preparation of necessary certificates, credit inspectors.
I'm going to buy an apartment in England, in a house that is not yet built. Can I get a grace period to repay the loan?
Yes, you can get a grace period for repaying the debt for the period of the construction of real estate for no more than 2 years from the date of signing the loan agreement. Deferral of interest on the loan is not provided.
How is the mortgage repaid in the UK?
The principal and interest are repaid monthly.
How is the loan paid?
Issuance of a loan for real estate and a mortgage loan is carried out at a time. The amount of the mortgage loan is provided in a non-cash order and transferred to the settlement account of the Developer in full.
Difficulties with payments. What to do?
If there are difficulties with payments, it is best not to wait for a call from the bank or collection agency, and most to go to them and explain the situation. Regardless of the circumstances, it is worthwhile to bring documents confirming the unforeseen events. (if you lost your job, it took a serious treatment or, worse, the burial of a relative - the main thing is to provide the relevant documents). Of course, it is unlikely that you will be forgiven for late payment of a monthly fee, but at least you can minimize penalties and delay the payment time a little. If you can not make a monthly payment due to illness or hospitalization, you need to send a copy of the sick leave sheet to the bank before the next payment date. The due date will be reviewed with minimal penalties. Even if you "# 8221; go to the manager and insist on reviewing the size of the monthly payment by extending the term of the loan, due to the circumstances.
If you have fully repaid the principal and interest on the loan, and the representatives of the bank call you about payment of fines for the delayed payment & # 8221; and so on-boldly sue-the truth will be on your side, but I repeat that the main debt and% of the loan must be paid and receipts. on your hands. I know how the employees of banks communicate with the debt collection departments, but if you are on the warpath, write down your conversation with them. In it, be sure to verbally confirm that the main debt and% are paid off, and they require just penalties or fees for overdue payments This will be good evidence in court.
Difficulties with payments. What to do? Help from the state.
You can also ask for help from the state. Often people think that if they bought real estate, they can not count on the help of the state. Of course, housing benefits are not paid to homeowners, even if most of your property is pledged to the bank. But there is another type of assistance - Support for Mortgage Interest (SMI). In case of financial difficulties, you need to find out if you are eligible for such assistance. This benefit will help cover only interest on a mortgage, and the state transfers this money to your bank directly. Do not be surprised if this assistance is not always equal to the interest on the loan that you have registered in your mortgage contract. The state calculates such assistance on the basis of a standard banking rate.
If your life circumstances have developed in such a way that you can not pay a mortgage, then the first person you need to be notified and to whom it is worth asking for help is the bank. Sometimes people in such circumstances avoid contact with the bank and do not respond to letters and phone calls. However, such a position is unreasonable and does not solve the problem. On the contrary, the first thing to do in case of serious financial difficulties is to call the bank and ask how to proceed. The bank can offer you "payment holidays", for example, completely relieve you of payments for several months, or transfer you to pay only interest on the mortgage (interest only). The bank can also reduce your monthly payments by increasing, for example, the term of the mortgage loan. It turns out that the bank can ease your financial press for a while. But not forever. All the deferred payments you will have to pay later.
However, all of the above can help you only in the case of short-term financial difficulties. If your employer does not guarantee payments for sickness, death, unemployment, disability, etc. or if you work for yourself, then there will not be any state payments to you to pay off your mortgage. If your financial situation is not resolved within a few months (for example, death or serious illness of the family breadwinner), you will most likely have to sell the house to pay off the mortgage. In order to avoid all these problems, it would be prudent to insure the main risks even while obtaining a mortgage and regularly review them. There are different types of insurance, and you can choose the best option for each family and for each situation. This will help you to save your property and minimize financial stress for your loved ones.
Is it possible to arrange an apartment bought on credit in England in common ownership?
Yes, the purchased apartment can be registered in the common property of the Borrower and his wife, as well as other family members (children and parents of spouses).
Will the apartment purchased under a mortgage in England be pledged to the Bank?
Yes, the acquired property is pledged to the Bank until the loan is fully repaid.
What types of income does the Bank take into account?
The bank takes into account all the main types of income: for primary and secondary employment, income from private practice, income of the spouse or wife of the Borrower, a pension early appointed for old age or for long service.
What is the maximum amount of the loan the Bank can give?
The loan amount is determined based on your solvency and depends on the collateral provided, but it can not exceed 80% of the value of the property.
Is it possible to somehow reduce the interest rate?
Yes, the possibility of lowering the interest rate is provided by the Bank.
What determines the interest rate on the loan?
The rate depends on the type and term of the loan, the amount of the down payment, and also on the bank in which you take the loan.
I am 50 years old, my wife - 40. For how long can the Bank give us a loan?
If you and your spouse are co-borrowers for a loan, the Bank will be able to provide you with a loan for up to 25 years.
Where can I get a housing loan?
You can obtain a loan from the branch of the Bank at the place of registration of the Borrower or at the location of the property.
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Mortgage in the UK.