What Will Mortgage Rates Be Like in 2023?

While it’s not possible to provide any guarantees about future mortgage rates, economists are broadly in agreement with each other in saying rates should start to come down in the new year.

In October, following the mini-budget, rates soared to over 6.5% in some cases. But the best mortgage rates on offer now (16/12/22) are as low as 4.55%.

Despite more base rate rises expected from the Bank of England throughout 2023, though, the most competitive mortgage rates are expected to keep coming down.

My Mortgage Maker is a mortgage broker in Bristol. If you live in or near the city and want to benefit from the best mortgage rates, get in touch.

Trying to find the best mortgage deal without the help of a broker is tricky. This is partly because brokers have good knowledge of all the products available, but also down to the fact that some lenders offer exclusive deals through brokers that you can’t get by applying directly.

With rates higher than we’ve become used to right now, finding the best mortgage deal is more important than ever. To discuss your mortgage or remortgage options, call today.

How Do Mortgage Lenders Calculate Affordability?

Each lender has their own way of working out mortgage affordability. The simplest systems begin by using what are known as income multiples. Typically, the maximum you can borrow is 4 -4.5 times your income. Depending on which lender you use, you may be able to include income from a second job or some state benefits when working out your maximum borrowing capacity. 

But this is just a start. Lenders will also need to examine your expenses to make sure you will be able to keep up with your repayments.

While your credit history, age, and deposit amount don’t directly impact mortgage affordability, they can influence the rate you are offered. And, of course, a higher rate means higher payments which will affect whether a loan is affordable.

As there are so many variables, you’re advised to speak to a mortgage broker who will help make sure you apply to the right lender according to your circumstances.

At My Mortgage Maker, we help people looking for a mortgage or remortgage in Bristol and the surrounding areas. Get in touch to discuss your options and how much you can afford to borrow.

Credit Reports Explained

If you’re applying for a mortgage, it’s important that you understand your credit report and how it could affect your chances of approval.

Essentially, your credit report is just a database of information detailing your last six years’ worth of credit and how you’ve managed it. It includes all types of credit such as loans, credit cards, mobile phone contracts and some monthly insurance policies – as well as mortgage payments if applicable.

It’s usually a good idea to check your credit report before applying for a mortgage so you can deal with any discrepancies that might harm your chances of success.

But credit reports are just one aspect of a mortgage application. Mortgage affordability is also a key part of a lender’s decision on whether to agree a home loan – as is the amount of deposit you have.

Each lender has its own eligibility criteria and attitude to risk too. That’s why it’s best to speak to a mortgage broker before applying. This is because, if you apply to the wrong lender and get rejected, this will leave a mark on your credit files. Lots of rejected applications in a short space of time can actually damage your chances of getting a mortgage.

At My Mortgage Maker in Bristol, we will take time to assess your situation before contacting the right lender to give you the best chance of being approved.

Get in touch today and let’s get you moving.

What Are the Benefits of an Agreement in Principle?

An agreement in principle (AiP) is not essential but can help to speed up the process of buying a home. Sometimes known as a decision in principle (DiP) or mortgage promise, an AiP is an official document from a mortgage lender that shows (in theory) how much you can afford to borrow and can help you calculate mortgage affordability.

There are two main benefits of an agreement in principle:

1. It helps you understand your purchasing power and price range
2. It shows estate agents and sellers that you are a serious buyer

It can be particularly useful if you are a first-time buyer or have a history of bad credit, as it will allow you to look for your next home with the confidence that it will be approved for a mortgage.

While an agreement in principle does not guarantee your mortgage application will be approved, provided the information you give is correct and your circumstances don’t change, the actual application process should be quick and easy.

My Mortgage Maker is a mortgage broker in Bristol. We can help you work out your borrowing power and secure an agreement in principle to get you started on your journey to home ownership.

To discuss how we can help you get on the first rung of the housing ladder, call today at 01225 962 532 or enquire online.

What is the Maximum Mortgage You Can Borrow?

Unfortunately, there is no single answer to this question as there are literally thousands of mortgage products out there and each lender has its own way of calculating affordability and risk.

As a guide, however, most lenders use income multiples of between 4 and 5 times your income to work out your maximum borrowing capacity. So, if the joint income of all borrowers is £50,000 and the lender uses an income multiple of 4, you could borrow up to £200,000.

But it’s not quite that straightforward. Lenders will also want to assess your credit file and look at your monthly expenditure. Calculating affordability is crucial and, if you have lots of existing commitments, this could prevent you from borrowing the full £200,000. Some lenders, though, might allow you to consolidate other debts into your mortgage to help you manage your monthly payments.

With so many variables, the only way to make sure you get the best mortgage at the lowest rate is to get advice from a qualified mortgage broker.

At My Mortgage Maker, we help customers in Bath, Bristol, and Woking secure the best mortgage deal possible. Get in touch today and chat with an expert about your mortgage or remortgage.

What is the Best Type of Mortgage for a First-time Buyer?

There is no single answer to this question as the right mortgage product depends on your individual circumstances. If you’re looking to buy your first home in Woking, Bath, or Bristol, we can help you assess your current situation and decide on the best first-time buyer mortgage for you.

For example, you can buy your first home via one of the government Help to Buy schemes even if you have only managed to save enough for a 5% deposit. In some cases, you might be able to borrow 100% of the property’s value.

If, on the other hand, you have a sizeable deposit, you may be able to take advantage of lower interest rates.

In some very rare cases, you may even be able to take out a first-time buyer interest-only mortgage.

There are many variables when it comes to deciding which is the best mortgage for a first-time buyer and the best advice is to speak to a mortgage broker who can look at all options and make sure to get the best deal available to you.

Contact My Mortgage Maker today and take your first step at getting on the property ladder.

What Affects Whether You Get Accepted for a Mortgage?

Mortgage lenders look at a number of factors when deciding whether to approve your mortgage application. These include:

·         Income – most lenders times your salary by 4.5 to work out the maximum you can borrow, although in certain circumstances this can be higher

·     Affordability – they will also check your monthly income and expenditure to confirm you can afford the repayments, this is known as mortgage affordability

·       Deposit amount – the larger your deposit, the more chance you have of being approved

·        Loan to value – this is the amount you borrow expressed as a percentage of the property’s value

·         Credit history – arrears, defaults, and missed payments on existing or previous credit agreements may not stop you from getting a mortgage but might mean you have to pay higher rates

The best way to make sure you get the best rate possible for your circumstances is to speak to a mortgage broker.

If you’re looking for a mortgage in Bristol, come to My Mortgage Maker for expert advice from a qualified mortgage broker with years of industry experience.