If there is anything that we can say about the mortgage market in the UK it is that it is an ever-evolving and quite unpredictable entity. As the economic landscape changes with the times, so do the people. When it comes to mortgages, things simply aren’t black and white anymore. People earn money in different ways, have different goals and ambitions for their money, and unfortunately a lot of people are finding themselves in financial difficulty. That means that the archaic rules and regulations held by banks and building societies when it comes to mortgage lending are in desperate need of a change. The Mortgage Lender (TML) is making waves with its unique and flexible approach to mortgage lending, quite frankly breathing a breath of fresh air onto a stale market. Offering a range of tailored solutions for various income types and credit situations, TML is proving to be a go-to choice for many aspiring homeowners and a favourite of mortgage lenders helping clients through a volatile mortgage market. Last week our advisors met with business development manager for TM Keith Campsie. In this blog we will explore the standout features from their meeting that sets TML apart from traditional mortgage lenders.
The Mortgage Lender – Empowering Employed Individuals
For those who are employed and seeking a residential mortgage, TML’s approach is very attractive. Unlike most lenders, TML considers 100% of evidenced overtime, bonus, and commission when assessing affordability. Additionally, they factor in 50% of shift allowances, making it potentially easier for individuals with varying income streams to secure a mortgage. With other big high-street lenders, any extra income is often subject to a lot of scrutiny by mortgage underwriters and in many cases only 50% is accepted across the board. Moreover, TML doesn’t stop there; they accept 100% of second job income and car/regional allowances such as the London Weighting Allowance. So for example, someone who works a full time employed job during the week and then a weekend part time job can potentially use both incomes toward their mortgage affordability, significantly boosting the maximum loan amount available.
Contractor-Friendly Mortgage Solutions
Contractors often face unique challenges when applying for mortgages because of the way they work and often the way they are paid, but TML simplifies the process. Many banks and building societies have issues with contractors because they are not traditionally employed. Because they don’t have a permanent employed role and often receive hourly rate, day rate, or weekly rate pay rather than annual salaries, this can become a bit of an issue. However TML have pretty straight forward criteria for contractors.
They can potentially accept income calculated up to a day rate multiplied by 48 weeks in a year. For instance, a contractor earning £400 a day could have their income calculated as £400 x 5 days a week x 48 weeks a year, resulting in a £96,000 per year income assessment. TML also offers a maximum loan-to-value (LTV) of 85% for experienced contractors with a minimum of 12 months of contracting history meaning that a contractor with this history could potentially borrow up to 85% of the value of their property with a minimum of 15% deposit contribution themselves.
New contractors with at least 3 months of contracting experience, combined with 12 months of employment history in a similar role or industry, can also be considered with a maximum LTV of 75%. So for example an engineer contracting with a company for 3 months but who has been employed as an engineer for the last 10 years could still be accepted by TML. Many lenders would insist on a minimum of 12 months contracting before considering an application.
Self-Employed Made Simple
Self-employed individuals, particularly limited company directors, often struggle to demonstrate their income for mortgage applications. TML simplifies this by considering both salary and a share of the most recent years’ pre-tax profit. They accept a variety of income evidence documents, including certified accounts, SA302s, tax calculations, and corresponding tax year overviews. TML offers a generous maximum LTV of 85% for self-employed borrowers with a minimum trading history of 12 months. This is unique in itself, because many lenders require a minimum of 2 or 3 years trading history before being considered for a loan.
Credit Issues? No Problem
The Mortgage Lender is perhaps best known for its stance on adverse credit with its borrowers. TML stands out by considering applicants with credit issues such as arrears, CCJs, IVAs, and even bankruptcy. Unlike many other lenders, they do not classify communication defaults like late phone bill payments and utility bill arrears as impaired credit. Even applicants in a current debt management plan can be considered by TML, providing a lifeline for those seeking to rebuild their financial stability. For more information about TML’s adverse credit criteria and how it might help you, please feel free to give our advisors a call.
For buy-to-let investors, TML specifies that there’s no minimum income requirement, and they will allow a maximum of four applicants on the mortgage, offering flexibility for group investments. TML caters to both individuals and limited company buy-to-lets, and the minimum and maximum loan amounts available range from £50,000 to £3,000,000. Notably, TML is willing to consider properties above commercial premises, a feature not commonly found with other buy-to-let lenders. Ex-pat buy-to-let landlords owning rental properties in the UK can potentially achieve a maximum LTV of 75%, extending TML’s reach to a diverse range of investors. For these type of borrowers, TML has set minimum income thresholds for applicants. Employed individuals must earn a minimum of £40,000 per year, while self-employed applicants are required to have a minimum annual income of £60,000.
Speak To a Mortgage Professional
The Mortgage Lender’s unique selling points in the UK mortgage market are great for those seeking flexible and tailored mortgage solutions. Their willingness to consider various income sources, credit situations, and property types means that they are a very valuable tool for any mortgage broker who can access their products. As the mortgage landscape continues to evolve, more specialist lending like the lending that TML provides will become more and more sought after. That’s why you should always consult with a qualified and experienced mortgage advisor. If any of this information resonates with you, please feel free to give our team a call today or send us an email to see how we can help.