Specialist Mortgage Broker - 7 Reasons Why You Should Use One
If your financial circumstances are complex and unique, you might be struggling to get the property finance you need. At the very least, you could be looking at higher interest rates, putting down a bigger deposit, or borrowing less money.
But using a specialist mortgage broker will ensure you get the most out of your mortgage.
It could not only save you time and money but could also secure you the loan size you need by maximising the potential of your income, save you cash on your deposit, and get you past those awkward credit score difficulties and expat statuses.
This guide looks at the top 7 reasons to use a specialist mortgage broker to secure property finance where a standard lender or broker just won’t cut it.
In This Guide:
Complex Income Mortgage Applications
Getting Access to Private Banks and Specialist Lenders
Expats, Returning Expats & Non UK Citizens with Right to Remain
Self Employed Income Mortgage Applications
High Earning Professionals
Non Standard Construction Mortgages
Complex Income Mortgage Applications with a Specialist Mortgage Broker
Specialist Mortgage Brokers excel at deciphering complex income portfolios and presenting them to lenders in a clear and consolidated format.
You might think that high street mortgage lenders, with the number of mortgages they process every day, are fully equipped to process complex income cases as they’ve seen it all before - but that's not typically the case.
With the number of vanilla mortgage applications coming through their doors every day, their service often focuses on providing cookie-cutter mortgage products to similar applications in bulk.
Head of Private Clients
Many of our clients don't realise how much they could borrow if they leverage all of their income sources properly - whether it's dividends, rental income, ad hoc self employed work, an investment portfolio, or a mixture of everything.
They don’t necessarily have the specialist underwriters or resources to deal with complicated income structures.
And at the very least, they need a specialist mortgage broker to liaise with who understands the industry and can package up applications to their standards.
A specialist broker knows the best lenders who can deal with complex income, including:
- Income paid in a foreign currency, be it US Dollars, Euros, Australian Dollars or any other legal tender.
- Income paid from multiple sources, e.g., employed professionals, is earned through ad hoc freelance and contract work.
- Company director income is earned through salary, dividends, director’s loans etc.
- Contractors or gig economy workers earn irregular income based on project completions and seasonal employment.
- Entrepreneurs earning from multiple businesses, rental income from a property portfolio, or perhaps through dividends from a share portfolio that can also be sold down to release capital – we can leverage all these sources of wealth.
Get Access to Private Banks and Specialist Lenders
A specialist mortgage broker will always look at high street banks if they can offer you a better rate.
But there are plenty of situations where a mainstream lender won’t touch your application if it’s outside their standard lending criteria - for example, you're a home buyer with a bad credit rating.
Or, they can offer you a mortgage, but the interest rate will be excessive because of the complexities of your financial situation.
You need to speak to a private bank or a specialist mortgage lender in this type of situation. They have the experts to look at the bigger picture of your wealth and income, no matter how varied or complex it is.
But going to private banks directly doesn’t always work – they all have their specialities and preferred way of doing things – a specialist mortgage broker will connect you to the suitable lenders for your particular case.
Expats, Returning Expats & Non UK Citizens with Right to Remain
High street mortgage providers don’t typically lend to expats or non UK citizens. And trying to find the best expat lender for your situation is notoriously difficult and time-consuming – it's a complex niche of the market, and every lender’s speciality is different.
But the right specialist mortgage adviser knows the ins and outs of the expat mortgage market and will be aware of what mortgage offers are available to what types of expats and foreign nationals.
Using a Specialist Mortgage Broker for a Self Employed Income Mortgage Application
A specialist mortgage adviser can also help with any self-employed mortgage application:
A Sole Trader – you work for yourself and keep 100% of profits from your business. You’ll be paying income tax and will require an SA302 to prove your income to your mortgage lender.
Freelancer or Contractor – You likely work for different companies, perhaps on longer-term contracts. Giving evidence of any future contracts in your pipeline could make the difference with your mortgage application - a specialist broker can help with this.
Partnership – if you collaborate with another shareholder, make sure you can prove your ownership and your earnings from the business.
Limited Company – if you've incorporated a limited company, you will likely be paid via a mixture of salary and dividends. But a specialist mortgage lender can ensure that your company’s net profits are leveraged for your mortgage, not just what you’ve taken as taxable income.
If you have a unique income and wealth portfolio consisting of liquid or illiquid assets, you might need to speak to a private bank to find a suitable mortgage.
A specialist adviser will analyse your wealth sources, both capital and income, and put your case forward to the suitable lenders.
Should You Use a Specialist Mortgage Broker as a High Earning Professional?
If you’re a high earning professional working in a renowned industry, you could get preferential terms on your mortgage.
For example, if you’re working in the legal profession as a solicitor or barrister, you could get a better mortgage deal with the right lender.
A specialist broker will connect you with the best lender for you who will consider your career prospects and job security.
Specialist lenders will look at future pay rises, and potential pay jumps upon the completion of qualifications and factor these into their mortgage calculators to get you a bigger loan or lower rates.
The same also goes for:
- Doctors and medical professionals
- Accountants and tax advisers
- Software developers
- And many other high earning professions
Non Standard Construction Mortgages with a Specialist Mortgage Broker
If you’re applying for a mortgage on a property with non-standard construction, high street lenders and building societies might reject your application at face value.
They’ll see issues with:
- Safety hazards
- The property could be expensive to maintain
- It could be challenging to insure due to the safety or security of your property
- It could be subject to more rigorous inspections and risk assessments that cost mortgage lenders time and money
- The property may be harder to sell in the future - the extra complications of non-standard constructions could put some buyers off.
And here’s a quick list of some common examples of non-standard construction homes:
- Thatched roof properties
- Steel frame properties
- Timber frame properties
- National Heritage Listed buildings (check the list here)
- Tower blocks or high-rise flats
- Concrete construction properties
- Pre-fabricated buildings
- British Iron and Steel Foundation (BISF) properties
Some lenders specialise in property finance for these homes, but you need to speak to the right ones to get a suitable product.
They have experts in place with years of experience with non-standard construction properties which can accurately assess the risks on behalf of the lender and won’t drastically inflate the cost of your mortgage.
But finding and comparing them is difficult – speaking to a specialist mortgage broker will save time by consolidating your options. You’ll get advice and a helping hand throughout your entire application process.
Using a Specialist Mortgage Broker for a Holiday Let Mortgage
Holiday lets are a booming industry in the current economic climate, but mainstream mortgage lenders have been slow to keep up.
With a typical buy to let mortgage application, the rental income of your property can be factored into your income for your application.
But the sporadic nature and irregularity of holiday let income can throw up issues with a standard buy to let mortgage application.
With a typical buy to let, rent is guaranteed for an assured shorthand tenancy (AST) of at least six months, and mortgage lenders like this level of security to offset risk with your application.
You’re more likely to keep up with your mortgage repayments with a regular, reliable income stream of rental payments.
However, despite holiday lets often producing well above the average revenue that a standard BTL would on a long term contract, many lenders are incapable of factoring this into their mortgage calculations due to the irregularity and won’t offer you reasonable rates.
It would help if you had a specialist lender. And again, having a conversation with a good mortgage broker reduces the hassle and ensures you’re speaking to the suitable lenders for your case.
A specialist holiday let mortgage lender will take the average annual yield of your holiday rental property and factor this in entirely to your holiday let mortgage application, so you’re not missing out on the potential loan size you can afford.
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