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DR Mortgages Ltd, Tunbridge Wells (2026)

19/08/2023

If you have a home and are considering the idea of 'mortgage holidays' but are unsure about their specifics, this article is for you.

A mortgage holiday, also called a payment break, grants you a temporary respite from your mortgage payments. An invaluable option during financial challenges or unforeseen expenditures, mortgage holidays can vary. You might encounter partial payment breaks, e.g. interest only, where reduced mortgage payments are made, or complete payment breaks, with no payments for a defined period. Common reasons for opting for a mortgage holiday include job loss, maternity leave, or medical emergencies.

The Pros of Mortgage Holidays
Unquestionably, mortgage holidays offer valuable interim relief during turbulent financial times. These periods of pause provide individuals with much-needed breathing room to address pressing expenses and regain their financial footing. The prospect of financial respite emerges as a significant advantage, allowing homeowners to temporarily alleviate immediate monetary strain. Moreover, this respite offers financial flexibility, enabling individuals to regroup and embark on recovering their financial stability. The stress reduction that comes with suspending mortgage payments cannot be understated, as it provides a momentary reprieve in trying periods, allowing individuals to focus on other critical aspects of their lives. Equally important is the time a mortgage holiday offers, empowering individuals to engage in thoughtful financial restructuring and recovery planning.

However, an informed decision regarding mortgage holidays hinges on a comprehensive evaluation of both their advantages and disadvantages.

The Cons of Mortgage Holidays
Among the downsides to consider, mounting interest emerges as a significant concern. While mortgage payments are on hold, interest continues to accrue, resulting in a higher overall long-term cost. Another potential drawback is the extension of the mortgage term due to the break-related pause, which may prolong the duration of the mortgage itself. Additionally, individuals must brace themselves for the possibility of increased repayments following the holiday period, as accrued interest can lead to elevated payment amounts. It's also essential to factor in credit score considerations, as differing lender reporting practices may impact one's credit score, potentially affecting future financial opportunities. Therefore, making a diligent and well-informed choice regarding mortgage holidays necessitates careful consideration of these pros and cons, ideally guided by professional consultation to ensure the best financial outcome.

Please note that the above article is intended for informational purposes only and does not constitute financial advice. Before making any decisions related to mortgage holidays or any other financial matters discussed, it is strongly recommended that you seek guidance from your current lender, a qualified mortgage arranger or a certified financial professional.

Their expertise and personalised insights will ensure you make well-informed decisions aligned with your specific financial circumstances and goals.

05/08/2023

Homeowners: Navigating the Latest Interest Rate Rise to 5.25%

Interest rates have risen to 5.25% following a 0.25% increase announced by the Bank of England.

This is the 14th consecutive rise and marks the highest interest rates in 15 years.

The reason behind these rate hikes is to combat high levels of inflation. The government has set a target of 2% inflation, and the recent inflation rate drop to 7.9% in June has been better than predicted by the markets.

As a result of these inflation figures, mortgage rates have slightly decreased recently. Experts anticipate that mortgage rates will continue to fall gradually in the coming weeks. The positive inflation numbers have given the market confidence that inflation will continue to decrease, leading to a more optimistic outlook and potential further rate reductions.

If you are a homeowner or landlord and have a fixed-rate mortgage, your monthly payments will remain unchanged until the end of your deal. However, if you're on a variable or tracker mortgage, your payments are likely to increase.

The Mortgage Lenders Charter, launched in July, aims to assist those struggling with monthly payments and those nearing the end of their fixed-rate mortgages by allowing borrowers to secure a new deal up to six months before their current deal ends.

The Bank of England's Monetary Policy Committee meets regularly to determine whether interest rates should rise, fall, or remain stable. It is expected that the Base Rate may peak at around 5.75% in early 2024 and then start to decrease in the latter half of the year. The next decision on interest rates will be announced on 21 September 2023.

For homeowners, this uptick in interest rates to 5.25% might raise questions about its impact on the area property market.

However, it's important to note that the property market has demonstrated its resilience and adaptability time and again. The gradual nature of these interest rate increases means that they have already been taken into account and priced into existing mortgage rates.

This factor could act as a stabilising force, offering homeowners a sense of reassurance.

The current environment might present opportunities for those considering property-related decisions, and the property market, known for its consistent growth, should continue to hold promise.

If you are a homeowner, or landlord, and would like to pick my brain, do not hesitate to get in touch - drop me a dm and I’ll get back to you

24/05/2023

Why a Mortgage Broker Could Make Your Property Purchase Stress-Free

Why do you need a mortgage broker?

Whether you’re a first-time buyer or looking to remortgage your property, getting a good mortgage deal is probably top on your list of priorities.

You could lose hours scrolling through comparison sites, frantically searching for high street lenders’ deals, and trying to find your latest payslips. Or you could do the sensible thing and get a professional’s help.

In this quick read, we look at why a mortgage broker could help you buy your dream home while saving you time and hassle.

1) Help with your budget

There are plenty of online tools that can tell you what you can afford and how much you’ll be paying every month when you get a mortgage. But there’s nothing like speaking to someone who lives and breathes mortgage deals to really understand your budget.

Mortgage brokers are financial advisers, so they can break down your monthly costs and explore your outgoings in detail. Their advice could help save you money, reduce those (unwelcome) costs you may not have accounted for, and provide bespoke advice to suit your individual financial situation.

2) Explain the ins and outs

There are many different mortgage variations and lots of jargon that can get confusing. From variable to fixed, tracker rates, interest-only, early repayment penalties… use a broker’s knowledge to your advantage and get them to explain what everything means.

3) They do the hard work

Getting a mortgage isn’t always a straightforward process. Lenders need lots of information, which can be overwhelming alongside your other responsibilities, such as work and family.

A mortgage broker does the hard work for you. They’ll probably ask for all your essential paperwork (such as identification, proof of address, payslips and so on) ahead of time so they can get on with the application on your behalf. They’ll also be able to chase lenders and get progress reports as your completion date nears.

4) Access to more deals

Brokers not only have access to high street lenders but to more specialist lenders, or to those that may not be easy to find through a Google search. They have years of experience working with lenders and could even be able to negotiate a better deal on your behalf.

In a volatile mortgage market, a broker’s help could make a real difference to the amount you pay per month.

5) Less chance of rejection

A mortgage broker will start by understanding your financial situation (an absolute must if you’re self-employed or have a chequered credit history). By doing this, they’ll be able to present your information in a way that helps a lender assess the risk you pose as a borrower and hopefully get you approved for a deal that may have otherwise been unlikely.

And if the worst happens and you’re not approved for a loan, they may be able to suggest other lenders that could look at your situation more favourably.

At DR Mortgages we have access to trusted mortgage brokers and can recommend someone to work with you. Get in touch with us if you’re looking for a new home.

30/12/2022

Wishing you a very happy new year from us all at DR Mortgages.

29/12/2022

The Property Market & Interest Rates

In the last year, the Bank of England has increased their interest rates a number of times.

This has led to speculation about the potential impact on the British property market.

One concern is that higher interest rates could lead to a slowdown in the housing market, as they make borrowing more expensive for both home buyers and landlords.

This could lead to fewer people being able to afford to buy or rent properties, resulting in lower demand and potentially lower property prices.

However, it is important to note that the property market is influenced by many factors, and interest rates are just one of them.

Other factors that can affect the market include the state of the economy, employment levels, and the availability of credit (both of which are excellent)

Overall, the impact of higher interest rates on the overall British property market is difficult to predict with certainty.

It is important for those considering buying or selling a property to carefully consider their own financial situation and the potential impact of interest rate changes on your ability to afford a home.

It may also be wise to seek the advice of a financial professional before making any major decisions.

If you would like to chat about anything discussed in this post, don’t hesitate to get in touch.

21/12/2022

Property terminology -

A cul-de-sac is a street or road that is closed at one end, forming a dead end. It is a French term that means "bottom of the bag," referring to the shape of the street, which typically ends in a circular turnaround. Cul-de-sacs are often used in residential neighbourhoods as a way to reduce traffic and create a sense of community. They can also be used to improve safety by limiting the number of places where vehicles can enter and exit the neighbourhoods

20/12/2022

Energy is such a hot topic right now so the findings of this article are no surprise…

https://www.mortgagestrategy.co.uk/news/potential-buyers-would-prefer-good-insulation-over-a-bigger-garden-mab

19/12/2022

More interesting stats about the property market currently - please don’t believe all you read about a property crash.

These statistics show that week 49 of this year was actually the 3rd best of the equivalent week in the last 7 years for number of properties sold stc.

17/12/2022

Are Mortgage Overpayments Good or Bad?

Mortgages are dull. Let’s be honest. They’re huge commitments, they’re complicated to arrange and in the current climate, it’s understandable if the thought of a mortgage gets you a bit jittery.

Putting rising interest rates to one side (easier said than done) and ignoring the doom and gloom news we’ve been exposed to over the last few months, it’s time to talk about mortgage overpayments.

What are they? Are they a good or bad thing?

In this four-minute read, we explain the ins and outs of overpayments.

(Note: This isn’t financial advice, and if you’re thinking about making overpayments you should speak to your lender or a financial adviser in the first instance.)

❓What is a mortgage overpayment?
In simple terms, it’s paying more than your contracted monthly mortgage payment. So, if you have a mortgage of £1,500 per month, and you pay £2,000, you’ve made a £500 overpayment. Simples.

You can make a one-off lump sum payment or regular overpayments.

❓Can you make overpayments on any mortgage?
Some lenders are happy for you to make as many overpayments as you like, whilst others may cap the annual overpayment percentage. It’s important to find out what category your mortgage falls into, as you could be charged a penalty for going over the limit.

The benefits of overpaying a mortgage might not be as great if you have an interest-only deal. If you have a repayment mortgage (where you’re paying the capital and interest) then overpayments will reduce the mortgage balance (i.e. the loan on the property itself). With an interest-only mortgage, overpayments reduce your future interest payments, however, you’ll still owe the original sum you borrowed to purchase the property.

❓What are the benefits of overpayments?
An overpayment now means you’re saving money in the future, as you’re effectively reducing the debt and the interest on the amount you borrowed to buy your property. So, as the big supermarket says: every little helps.

By making overpayments, you’re also increasing the equity in your home as you’ll own more of it than you would by making your contracted monthly payment. And every overpayment is a tiny step closer to being mortgage-free.

❓What are the disadvantages of overpayments?
It may mean you have less cash to hand for that rainy day. By using your savings to overpay a mortgage you could leave yourself financially vulnerable if something unexpected occurs, such as job loss or illness.

Other debts you might have (such as credit cards) are far more expensive, so it makes more sense to pay them off before considering mortgage overpayments.

If you’re considering making an overpayment, always speak to an expert first. They can help you decide what the best course of action is for your individual financial situation.

01/12/2022

Number of Properties Sold - subject to contract - in UK last week was up 11%

With all the doom and gloom in the newspapers, you would think the property market was on its knees.

Of course, it’s not as easy to sell a house as in 2021, yet priced and marketed right, properties are selling well.

Fo the week ending Sunday 27th Nov 2022 - 17,925 properties were sold stc, compared to 16,138 properties the week before -
a growth of 11%

Here is a regional breakdown

Yorks & Humber +12%
West Mids +15%
Wales +15%
South West +9%
South East +12%
Scotland +2%
Inner London +5%
Outer London +17%
North West +12%
North East +11%
East of England +9%
East Midlands +21%

If you are considering moving home in early 2023, then don’t be put off by the media!

18/11/2022

This graph shows the number of weekly house sales in the U.K. (yellow line) dropping - if this was in a newspaper it would be doom and gloom

Yet with all things like this, the devil is in the detail

2020 and 2021 were exceptional years for the U.K. property market

In Q4 2020, an average of 23,071 properties sold per week in the UK

In Q4 2021, an average of 21,051 properties sold per week in the UK

So with the average at 19,694 per week Quarter to date .. surely we should run for the hills?

Until you look at the averages for 2019

In Q4 2019, 16,263 properties sold per week sold

In Q4 2018, 15,922 properties sold per week sold

In Q4 2017, 15,721 properties sold per week sold

In Q4 2016, 15,811 properties sold per week

We are just going back to the ways things were before lockdown.

If you are a homeowner or landlord, don’t believe what the newspapers are putting out and look at what is really happening

Don't get me wrong, house prices will be lower next year (good I say)

Its going to be hard work in 2023 .. but its not Armageddon like the papers say.

17/11/2022

ALL LANDLORDS, HOMEOWNERS & THE AUTUMN BUDGET 2022

The Chancellor, Jeremy Hunt, gave his Autumn Budget 2022 at lunchtime, intending to deal with inflation and keep mortgage rates down for homeowners.

In this short and sharp post, I wanted to touch on what this would mean specifically for local landlords and homeowners thinking of buying and selling

Capital Gains Tax Changes
In previous articles about the property market, I touched on the muted plans from 2020 to increase the Capital Gains Tax (CGT) headline rate.

Instead, in the Budget, the CGT relief allowance has been cut from £12,300 to £6,000 for the next tax year (2023/4) and then cut again to £3,000 for 2024/5.

Therefore, if you are a basic rate taxpayer, you will end up paying £1,134 extra in CGT after April 2023 (and £1,764 if a higher rate taxpayer) and a further extra 50% on top of those figures in tax year 2024/5

Only second homeowners and landlords pay Capital Gains Tax on the difference between the price you paid for the property and the price you sold it for. (Note- it is not paid on any gain of your principal residence)

This will be unwished-for news for landlords and second-home owners.

Even if you have no intentions of selling your portfolio in the next five to ten years, there are things you could be doing now to reduce your CGT liability in the future. However, there are various reliefs landlords can apply to HMRC for that will reduce the CGT liability. If you would like some names of good local accountants, drop us a line, and we can suggest some for you.

Is it worth selling your rental property now? Well, the average conveyancing time for UK property from sale agreed to exchange of contracts is 19 weeks, which takes us to 30th March 2022…all to save £1,764 …all at a time when rents have rocketed by 19% in the last two years.

Stamp duty cut to stay - yet only until 2025
Kwasi Kwarteng's cut to stamp duty in England announced in his September Budget will remain until 31st March 2025.

Jeremy Hunt stated because housing activity will be slower in 2023/4, the stamp duty cuts announced in Kwarteng’s mini-budget will remain in place for the next two years and four months.

This means that the price of a property before stamp duty is paid will stay at £250,000, up from the previous level of £125,000 until March 2025, then drop down to the old rates.

This will be good news for home buyers and landlords in the coming years.

Please do get in touch via dm if we can be any assistance.

DR Mortgages Ltd

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