Pinpoint Finance
01904 866 100
|
CLIENT LOGIN
  • General News
  • Mortgages
Posted on September 27, 2022

Cost of living and how it may affect your next mortgage application

Cost of living crisis

The cost of living crisis may affect your next mortgage application. We have considered how this may come about for some and what steps you should consider.

With the cost of living squeeze on finances, the possibility over the coming months will mean more households may turn to their overdrafts and credit cards to fund their lifestyles. So just how does the use of unsecured debt affect your potential to borrow for a mortgage?

Most lenders have a “debt-to-income” calculation, exceed this level and your overall affordability will be marked down notably.  This debt-to-income calculation differs dramatically between lenders also their appetite for the type of mortgage applicant you are. Factors such as your household income or the loan to value of a mortgage application will also play a key factor in any decision.

Things to consider when it comes to the cost of living?

Credit card usage can be specifically sensitive to a mortgage decision. In particular, the level of usage compared to your credit card limit. So, if you are close to your limit or using it for cash advances, it’s highly probable that it will affect your overall credit score.  Remember is not also the level of unsecured debt that’s important but the overall percentage compared to your income.  This could easily result in a declined mortgage application, which will most likely be at the Decision in Principle stage of an application.  Some lenders publish this debt-to-income calculation, so using a trusted mortgage adviser will help to navigate such a pitfall.

Can I re-mortgaging to repay debt?

Re-mortgaging to repay debt is likely to be more common as households feel the cost of living pinch, but this can present its own set of hurdles. Many lenders will set a maximum loan to value for debt consolidation, (usually 80% LTV) but again your mortgage adviser should know this.

With higher levels of unsecured debt expected and a general squeeze on household incomes, it’s inevitable that some people will “drop the ball” on their finances with missed payments, exceeded limits, or unpaid items on their accounts. Such, unintentional lapses will show on your credit file and may affect your mortgage application.

What should I do if I have unsecured debt and need a mortgage?

  1. Knowing what’s on your credit file is an important stage of any mortgage application. So, before you start, it’s a really good idea to review your latest credit report.  The best way to do that, in our opinion, is to download your personal report via Checkmyfile. There are several organisations that offer credit report checks. However, Checkmyfile is the only website we recommend for this type of service.
  2. Use a mortgage broker who is experienced in helping people like you. This can help you save time, money, and a significant amount of stress. Pinpoint Finance can help you get a better understanding of your financial situation, know which lenders to approach, and limit the impact of a mortgage rejection.
  3. Get in touch with Pinpoint Finance, we’re a straight-talking team of ex-bankers, we’ve been around the block and seen all eventualities. We’ll tell you as it is and deliver what you need.
Previous Post
How Do I Apply For Business Finance?
Next Post
Frequently Asked Questions – Portfolio Landlord

Latest Posts

Buy-to-Let Mortgage - Pinpoint.finance
5 Reasons Why You Should Use Pinpoint Finance for Your Next Buy-to-Let Mortgage
The Current State of the Buy-to-Let Market: What Lenders are Doing.
How to Cut your mortgage payments
FIVE WAYS HOW TO CUT YOUR MORTGAGE PAYMENTS
Portfolio landlord
Frequently Asked Questions – Portfolio Landlord
How Do I Apply For Business Finance?
What Is An EPC Rating And How Does It Affect Landlords?
Why Should I Use A Mortgage Broker?
Coronavirus: Mortgage payment holiday
Coronavirus Statement – COVID-19
Having a Buy to Let re-mortgage headache?

Pinpoint Finance

01904 866 100

Keith: 07547 540 541

Kelvin: 07826 603 635

Anna: 07442 775 270

hello@pinpoint.finance

Pinpoint Finance

01904 866 100

Keith: 07547 540 541

Kelvin: 07826 603 635

Anna: 07442 775 270

hello@pinpoint.finance

York Eco Business Centre, Amy Johnson Way, York YO30 4AG

York Eco Business Centre
Amy Johnson Way, York YO30 4AG

  • Business finance
  • Buy to let mortgages
  • Cashflow Finance
  • Checkmyfile
  • Commercial mortgages
  • Free Product Transfer Service
  • Merchant Cash Advance
  • Property finance
  • Residential mortgages
  • News

NACFB

Membership number: 23362

Pinpoint Finance is Authorised and Regulated by the Financial Conduct Authority (FCA), reference number 733225. Click here for the FCA website.

Pinpoint Finance is a credit brokerage and not a lender and is registered with the Information Commissioner’s Office number ZA146757.

We work with the whole market of lenders who may pay us a commission. The amount of commission paid varies between lenders.

Commercial Mortgage Broker York North Yorkshire. Refinancing premises, funding new lease or building, raising collateral.  Great customer service for your next real property asset investment.
Pinpoint Finance is a trading style of Pinpoint Commercial Finance Ltd, a company registered in England and Wales, number 9825825. Registered Address: 3-4 Park Court, Riccall Road, York YO19 6ED.

Fees, commissions & other costs | Privacy Policy | Complaints Policy | Cookies | Disclaimer

Linkedin
Email
Phone