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Those individuals living in the UK may be familiar with the term county court judgments, or ccjs. A ccj is a court judgment which is registered against an individual for any number of reasons. The ccj is basically the court stating that an individual failed to pay a debt and has received a monetary judgment against them. Many lenders and business entities will research the ccj registry to see if an individual is on it prior to lending them money or credit. There are many reasons why UK ccjs affect an individual who is trying to obtain a mortgage or remortgage.

Alludes to Credit Worthiness

One reason why companies consider mortgages with ccjs of an individual or loans with ccjs of an individual is that the ccj is a judgment that relates to credit worthiness. If an individual has a ccj, this means that they were unable to repay a debt in the past and it even went to such lengths as to have a ccj issued against the debtor. This is why companies perform a ccj check, so that they may check on the individuals credit worthiness. If that particular person has a ccj under their name, the lender may hesitate when issuing a mortgage or remortage to the debtor.

Relates to Future Debt Patterns

Some lenders check the ccj registry not only to ascertain current and past credit worthiness but future debt patterns as well. A ccj check may help the company to decide whether the individual who receives a mortgage or remortgage will be more likely to repay the debt in the future. Those individuals who have multiple ccjs issued against their name may be less likely to obtain a ccjs mortgage or remortgage ccj than those who only have one ccj issued against them on the registry.

Provides a 6 Year Credit Span for the Company to Review

Companies and mortgage lenders also like to review the ccj registry as it gives them some insight into the past six years of the applicants life. Since ccjs remain on an individuals record for six years past the repayment of the debt, reviewing such a registry will provide additional information to the company as ccj removal is not an instantaneous occurrence post-repayment.

Allows Companies to Review the Overall Lending Risk

Lastly, those companies who review the ccj registry to determine whether they should lend to an individual or not allows them to review the overall lending risk which they might encounter should they lend to a particular individual. Again, those individuals who have multiple ccjs may be less likely to see a loan come their way. Lenders can use the ccj registry to aid them in their lending decisions.

Summary

The ccj registry is something that lenders consult quite frequently in the UK. It provides companies with some insight with regard to lender habits and past nonrepayment of debts. It is important to keep in mind however that even though an individual may have a ccj against them, this does not obliterate all chances of obtaining a mortgage as some lenders offer mortgages and remortgages to those with ccjs.

Online Mortgage Brokers – What You Might Not Know About Home Loans & The Internet

You may think that applying online for a mortgage is the same as applying with a broker in the ‘real world’, only more convenient.

While applying for a mortgage online is much more convenient, and sure to help you get a lower rate because of the amount of competition online, there is another benefit to using the internet when applying for a loan.

Sometimes when you meet a broker and he/she takes a look at your financial qualifications, they might say, we can get you this rate. And that’s it. That is your loan option with that broker. Most brokers have the mentality of wanting to process as many mortgage loans as quickly as possible, which is understandable. Well, one thing that you might want to know to help yourself out is that there are literally hundreds of different mortgage programs available. Most brokers and lenders will not explain to you the mortgage options you do have. They usually have a few favorite programs and will just use those over and over since they know them.

A great way to help yourself is to research loan programs online. One benefit of the interne is that there are many informative articles and information to help you understand the pro’s and cons of every kind of loan program, FHA loans, balloon mortgages, VA loans, graduated payment mortgages, Fannie Mae and Freddie Mac loans.

Once I started doing my research online and reading through the mortgage company websites online, I was amazed to discover that there are mortgage loans online that I would have liked to had when I first bought my house, but I didn’t even know they existed and they were never offered to me by my broker. I would have saved myself a lot of money had I done my research online first.

To view our list of recommended mortgage lenders online, visit this page: http://www.abcloanguide.com/mortgageloans.shtml.

After you scraped together a modest deposit for your new home you may think you’re home and dry. Think again. On top of there’s the surveyors and solicitors to pay. Then the government want a slice. You’ve got to pay stamp duty at 1% of the property’s price (if the house costs more than 250,000 the rate of stamp duty increases see the information at the foot of this article). Phew! You’re lucky you’ll just make it you’ll be a homeowner at last!

Then out of the blue the mortgage lender sends you a new bill another 1,500 please Sir. They’ve called it a Higher lending Charge (HLC) and it’s charged if you borrow more than 90% of the value of the house. About 75% of all mortgage lenders charge it and 1,500 is about the average they ask for.

And guess what they money you pay won’t benefit you in any way whatsoever! Not one jot. You’re being charged for a form of protection insurance that protects the mortgage lender, not you. The HLC pays the lender if you default on your mortgage, your property has to be repossessed and the sale proceeds are less than the outstanding balance on your mortgage. In theory the HLC then pays out the shortfall to the lender but in practice many lenders carry the risk themselves so the HLC is just an extra fee to offset a higher lending risk.

But an HLC doesn’t let you off the hook! If your home is repossessed and there’s a shortfall, you still have to pay the shortfall back to your lender – they’re sure to chase you for the money.

Whilst most of the lenders who charge HLC’s will readily agree to add the charge to your mortgage, that’s little consolation. In any case this means that you’ll end up paying interest on top of the charge. Then, over a 25-year term, your HLC will have cost you closer to 2,700!

In our opinion HLC’s should have died out with the dinosaurs. If a lender is worried you’ll default, they shouldn’t have lent the money in the first place. And with all today’s hi-tec credit checks and the risk based assessments used to process your application, you’d think the lenders were doing enough to protect themselves. In any case you may also end up paying a small interest premium for a 90% plus mortgage so in practice you’re being charged twice for the same risk!

The Nationwide Building Society, who incidentally do not charge HLC’s, recently reported that during the last five years 1 billion has been charged in HLC’s by some 800,000 borrowers. It also found that just over 500,000 were first time buyers largely youngsters struggling to buy a home. We believe that HLC’s are just another money making ploy for the mortgage lenders. By the way, the Higher Lending Charge used to be called a Mortgage Indemnity Guarantee, but they are all the same – only the name is different!

We think it’s time for the Office of Fair Trading to open up the box and take a look inside in the same way as they did with credit cards. The OFT recently ordered many credit cards to reduce their charges by up to 40%. A bit of that magic would do wonders for Higher Lending Charges!

Current Stamp Duty rates on house purchases in the UK

Houses under 125,000 No Stamp Duty

Houses 125,000 to 249,995* 1%
Houses 250,000 to 499,995* 3%
Houses over 500,000 4%

*HM Inland Revenue rounds up house prices to the nearest 5. Therefore, a house sold for between 249,996 and 249,999 will be rounded up to 250,000 and they’ll charge you 3% Stamp Duty on the lot!

Information correct as from the April Budget 2006.

Mortgages. First-Time Buyers Let Down By The Governments Homebuy Scheme.

Late last year, accompanied by the usual razzmatazz, Gordon Brown announced the Governments new Open Market Homebuy mortgage scheme for first-time buyers.

Under the Homebuy scheme, first time buyers take out a mortgage for 75% of a home’s value with no deposit and the Government and the mortgage lender will in practice buy the remaining 25% of the property. Then when the borrower eventually decides to sell the property, the borrower will receive 75% of the net sales proceeds and the remaining 25% of the sale price will go to the Government and the mortgage lender. In the mean time, if the owner wishes to buy out all, or part, of the Governments or mortgage lenders 25% interest, the borrower can simply repay the money the Government and mortgage lender initially put in.- there will be no penalty.

In our view, first time buyers shouldn’t become too excited about this scheme for six reasons: –

The Government has recently confirmed that buyers will have to pay a 1% premium on top of the usual mortgage rate.

There has been no announcement as to the amount relative to income, which borrowers can qualify for. So at this stage it’s impossible to judge what sort of house a first-timer could buy. However, we bet it’s a very small one!

Despite hopes that more mortgage lenders would join the Yorkshire Building Society, the Halifax, and the Nationwide, as co-sponsors of the scheme, no additional lenders have been added to the list.

The Government expects Homebuy to lend to 4,000 first time buyers per year. That’s only fractionally over 1% of the 361,000 first time house purchases arranged each year. In terms of availability, it seems as if Homebuy mortgages are going to challenge hens teeth!

The Government hasn’t even announced the rules under which a first time buyer can qualify to even apply for a Homebuy mortgage.

The scheme is not planned to be operational until October 2006.

So even if you’re happy to pay the 1% premium, your chances don’t look too good for qualifying for an Open Market Homebuy mortgage. Our advice is to forget about them and find a top class mortgage broker to seek out a great deal on the open market.

Signs that our reticence is shared amongst Members of Parliament came from a comment from Michael Grove, shadow housing minister. He is reported as telling the Sunday Telegraph that he wanted to see the Homebuy scheme made easier and cheaper for lenders in order to encourage greater participation from the mortgage providers. We think that’s fine, but participate in what? Until we know who can apply and how much they can borrow, the scheme means nothing.

In the last 3 to 5 years we have seen rises of up to 450% in the exit fees charged by lenders when borrowers redeem their mortgage. But at last the Financial Services Authority (FSA) ha seen the light and is going to crackdown on these increases.

Lenders have been telling new borrowers about the exit fees currently charged, but the lender has retained the right to increase those charges at any time and without advising borrowers. This amounts to a free hand to increase these charges and many lenders have taken the opportunity gladly.

Take the Woolwich for example; they’ve increased their exit fee from what was 95 to 275. The Cheltenham & Gloucester has increased theirs from 50 to 225. The lenders have clearly been trying to penalise those of us who regularly switch their mortgage to get the best interest rates the so called rate tarts and at the same time line their coffers.

However, the FSA is now in talks with the mortgage lenders to bring them to heal. The FSA wants fees to be fully disclosed at the outset and for the disclosed exit fee to be fixed for the duration of the mortgage. The FSA hopes to have agreed a binding undertaking from the lenders by June this year.

On a wider front, borrowers should always remember to take into account all the charges and money saving offers when working out which mortgage is cheapest for them.

To illustrate this point, let’s say you wanted a 2-year fixed rate mortgage and were attracted by the offers from the Northern Rock and the Halifax.

Northern Rock currently charges an interest rate of 4.19% plus a 1.5% arrangement fee and an exit fee of 250. Halifax’s interest rate is 4.39% with an arrangement fee of 499 and exit fee of 175. Within Halifax’s package there’s also a free valuation and free conveyancing that typically could save around 750. So which mortgage deal is the cheapest?

Taking a 25 year repayment mortgage for 100,000 and costing it over the first two years with redemption at the end of the second year, The Northern Rock comes out at 14,671. The Halifax comes out at 807 cheaper at 13,864. And this saving doesn’t take into account the extra 750 valuation and legal savings offered by the Halifax. Therefore, assessed on this basis, the 4.39% headline rate offered by the Halifax is in fact the cheaper deal.

Another issue that will affect the true cost of your mortgage is whether the interest is charged on a daily, monthly or annual basis. On an otherwise like for like basis, annually calculated interest will always work out more expensive because for 11 months of the year, you are charged interest on money you have already repaid.

The best advice is to read all the small print! And remember that the lenders use all sorts of words to describe charges – application, arrangement, reservation, booking, completion and early redemption are all words to described charges or fees. Keep your eyes skinned!

When it comes to searching for the right kind of mortgage to meet your needs, you will probably come across a decision about who you should borrow from: Do mortgage brokers or banks make better lenders?

A mortgage broker is a mediator that facilitates the process of acquiring a mortgage for individuals as well as businesses. Essentially, they are like home loan supermarkets. Their broad access to lenders as well as their wide offering of various programs makes them a convenient source of help for many borrowers. If you have less-than-perfect credit or are in unusual circumstances, mortgage brokers can still find you the type of funding you need. Mortgage brokers will charge a brokers fee, which you should ask about and take into account when calculating your initial payments.

Mortgage brokers will typically originate, process, and pass the loan on to a lender who will subsequently sell it to an investor. They take commission and will have higher closing fees. Beware of gouging, as brokers have full discretion on how much they want to charge the borrower for processing the documents necessary for the loan.

Today, about 20,000 mortgage brokerage operations account for more than 80% of mortgages are issued by mortgage brokers in the U.S. The convenience and resources they offer to borrowers is the key to their popularity.

The term mortgage banker refers either to an individual loan officer who works at a bank or to the bank itself. They specialize in originating mortgages and selling them to investors and continue to service them. Both the origination and servicing processes require fees, which are the two primary sources of income for mortgage banks.

A key difference between mortgage banks and mortgage brokers is that banks have more of a standardized and set approach to setting fees. Bankers are told what fees to charge and are told not to stray away from them. This allows for more stability and prevents the borrower from being surprised when it comes to discovering what the fees for the home loan will be.

Now the question is which is the better option? The answer is quite simple: Whoever gets you the better deal. It should be noted that while some borrowers enjoy the comfort and help of having a mortgage banker see them through the life of their loan (though not all do), while others do not mind either way. This discernment, along with a thorough comparison of deals that you can get from mortgage brokers and bankers, should give you a fairly clear idea of which path to take.

For more in depth coverage on various mortgage and real estate related topics, please visit Mortgage

Recent statistics from the Department for Constitutional Affairs state that court actions by mortgage lenders rose to 28,476 in the second quarter of this year for those that dont follow such trends thats up over 50% on one year ago. Also, at 18,330, the number of repossession orders was the highest for 9 years.

Although yet to reach the previous peak of around 40,000 repossessions in the second half of 1991, this is a very worrying trend for homeowners and landlords alike, who have got used to permanently rising prices and historically low interest rates and borrowed against ever increasing equity either to fund a higher quality lifestyle or to pay the deposits on further investment properties.

The massive house price inflation over the recent years gives lie to Gordon Browns boasts about his low inflation economy. However the mock shock horror at the antics of yet another lying politician is of no importance. What is VERY important is the fact that it is consumer borrowing against this property price inflation that has kept the economy afloat. With house price inflation slowing, stopping, or going into reverse (depending on whose statistics you believe), people have nothing left to borrow against and are reaching their limits. Combined with the UKs near total de-industrialisation and reliance on the service sector (which has little or no export value), this is going to have a serious negative effect on the economy in the near future.

So what does that mean for you the landlord? A sudden large-scale collapse in prices – as seen in the early nineties – seems unlikely to this author because there are still more people in need of housing than there are suitable and available properties; simple supply and demand economics – people will still need property to rent.

However if the economy takes a severe downturn, aside from other problems too complex to cover here, then a lot more peoples rent will have to be met by the government. As well as the obvious strain on the taxpayer, this is quite obviously bad news for those private landlords who refuse to take tenants who are claiming housing benefit. If you think about it, Housing Benefit is better than free property advertising in that there are a constant stream of takers and the cheques definitely do not bounce!

Those negative landlords are, as in every business, the ones that will find themselves being left behind the proactive landlords who have already opened their minds and embraced the income stream generated by tenants on Housing Benefit. Although there may be problems at the moment, the council is working very hard to overcome them and make the service all that it should be.

There used to be an almost dizzying variety of mortgage options out there. But that was then. This is now. And anyone who wants to buy a home these days needs to be prepared for a shrinking number of choices. Lenders are pulling back-to the basics. But it’s not all bad news. A homebuyer who has proof of income, cash reserves, or good credit should sill be able to find a home mortgage loan. But you have to be ready and willing to do some shopping around first-comparing and negotiating-just like you would if you were looking for a new car. Speak to several lenders. And it’s also a good idea to contact several mortgage brokers, too. They act as liaisons between lenders and consumers.

It’s never been more important to be an informed homebuyer. Learn the basics of what it takes to get a mortgage. Start by finding out if the lender requires a down payment, how much it is, and if you can afford it. Because of the current economics of housing, most house hunters must have the money for a down payment. That’s because the no-down-payment loans that were available during the boom years are now almost non-existent. Many lenders now insist on a minimum of five percent down-more is even better.

You’ll also want to check to see if you’ll be required to buy Private Mortgage Insurance (PMI)-which will be added on to your monthly mortgage payment. Many lenders insist on this, because if protects them against loss by borrowers who fail to pay. As a rule of thumb, expect PMI if a loan exceeds eighty percent of a home’s value. To avoid the added expense of PMI, some borrowers get a “piggy-back” mortgage-which is essentially taking out two loans. The first loan covers eighty percent of the cost of the home. The second is a home-equity line of credit that covers most-if not all-of the balance. However, be aware that these piggy-back loans are few and far between these days; many lenders see them as a risk they’d rather not take. That’s because if a homeowner loses the house, the proceeds from the sale would go to paying off the first mortgage-and there’s usually very little left from that to cover the second mortgage.

Now, what about those low-or-no-documentation loans that were so popular awhile back? Well, they’re basically extinct. Why? Because the single-most important thing to lenders these days is a borrower’s credit score. The lenders are relying more heavily than ever on that score to assess a borrower’s ability to repay a mortgage on time. Borrowers that look risky will not get those lower-interest loans with good terms. In fact, they’re not likely to get a mortgage at all. Loans available to people with credit scores of, say, 660 just a few months ago are no longer out there.

But even if you have a good credit score, you need to be aware that you need to use it wisely. For instance, weigh your choices carefully if you’re thinking about taking out a loan for more than $417,000. This is known as a “jumbo loan”-and mortgages that exceed this make lenders very wary; they are perceived to be much riskier than “conforming” loans.

So what’s a potential homebuyer supposed to do? If you credit score is on the low side, get serious about improving it before you start looking for a mortgage. It will definitely increase the number and types of mortgage options available, as well as the rates and terms of those mortgages. If your credit score is high, then keep it that way-don’t push for the maximum mortgage you can get. Be conservative.

With careful tending, the mortgage landscape in your little corner of the world will start looking considerably more lush, healthy, and beautiful.