Co-buying a home can be very beneficial if you and a maximum of 4 friends or family members can invest together in the property. However, before you decide on this purchase, you should consider several aspects:
– you can immediately invest savings you have in a property instead of paying rent for your current house or flat. By buying a share of a property you save – house prices are rising and you pay only part of the deposit
– remember to draw up a Trust Deed, which will specify the amount of deposit paid by each co-buyer or describe procedures of leaving the co-ownership arrangement
– all parties involved in the purchase are obliged to repay the loan – if one person does not pay their installment, the rest is responsible for paying the mortgage.

Remember – before making a decision, it’s always worth talking to a financial advisor who will explain the co-purchase procedure and answer all the questions you may have.


 

It doesn’t matter if you own a house or an apartment – the place where you live is undoubtedly one of the most important, which is why it is crucial to make sure that you have adequate protection in the event of an unexpected.

There are two types of insurance – building and content. The first includes the structure of the house – the roof, walls and windows as well as fixed elements of the property such as kitchen or bathroom. This insurance usually protects your home against fire, storms, floods, subsidence, bursting pipes or theft. Building insurance is unlikely to protect you against wear and tear, war or terrorist acts. Having home insurance is not mandatory, but if you are in the process of buying a property or have a mortgage for your home, such insurance will be necessary.

Content insurance usually covers the cost of buying new home furnishings in the event of loss of a worn one. Some insurers may include wear and tear, which may reflect in the amount of compensation you receive for a damaged item. For an additional fee, you can also buy insurance that that will protect the contents of your home in the event of accidental damage. Personal property insurance (e.g. cameras or laptops), may also be useful.


While insuring our homes, telephones and even our lives, we tend to forget about protection that will support your finances when you can’t work because of illness. This is how critical illness insurance works – this is a type of protection that, if illness diagnosed, will help you receive a tax-free lump-sum to cover the costs of treatment or replace income that you lose as a result of being unable to work.

Critical illness insurance can take various forms, e.g. insurance, whose final amount increases with inflation, protection that is associated with your mortgage and decreases as mortgage debt decreases or critical illness insurance combined with life protection.

Remember: during the application the insurer will ask about your family’s medical history, amount of cigarettes smoked and alcohol consumed as well as other personal data. At this stage you must provide true information – otherwise your insurer may reject any claim you make.


Most of us is considering financial advisor’s services when looking for a suitable mortgage. Their main task is to help buyers find the best possible mortgage offer tailored to their individual situation, as well as to make the process of buying a home as simple and stress-free as possible.

The financial market offers a huge number of mortgage products and their analysis can be complicated. In addition to a large number of financial options, buyers must take into account their individual income and personal situation as well as the type of property being purchased.

Considering the comprehensiveness of the property purchase process and the number of factors that may change, as well as the variability of mortgage products and processes, it is worth considering the help of an adviser – who, when dealing with mortgage brokerage on a daily basis, will be able to offer the best option suited to your personal circumstances and expectations.


UK average house prices increased by 2.2% over the year to November 2019, up from 1.3% in October 2019.

 

Average UK house prices peaked at £235,000 in November 2019

Average house prices increased over the year in England to £251,000 (1.7%), Wales to £173,000 (7.8%), Scotland to £155,000 (3.5%) and Northern Ireland to £140,000 (4.0%). The annual increase in England was driven by the West Midlands and North West.

 

At a regional level, the West Midlands was the English region with the highest annual house price growth, with prices increasing by 4.0% in the year to November 2019 (Figure 4). This was followed by the North West, increasing by 3.8%.

 

 

Mortgage rates have fallen on average for both two-year and five-year fixed-rate deals (75% LTV)

Fixed-mortgage rates have decreased in the past two years, according to the Bank of England. If you put down a 25% deposit on a property in June 2016, the average rate you would pay for a two-year fixed-rate mortgage was 1.75%. In contrast, in November 2019 it was 1.44%. This suggests that now is a good time to get a mortgage, as interest rates are low. This means your monthly repayments would be lower than they were in 2016.

 

The decrease in rates was even higher for five-year fixed-rate deals. In June 2016 the average rate was 2.54%, while in November 2019 it was 1.69%.

 

For example, for a £200,000 property on a 25-year mortgage, with a 25% deposit an example of the monthly payments would be as follows:

 

2.54% interest: £789 / month

(The total you’ll repay over full term (Includes mortgage debt, £175,000 + total interest £61,588) Total: £236,588)

 

1.69% interest: £715 / month

(The total you’ll repay over full term (Includes mortgage debt, £175,000 + total interest £39,608) Total: £214,608)

 

The benefits of a 5-year fixed term may come to light with uncertainty in the economy. However, in the event of the UK having a troubled exit from the EU on the 31st January, such as the scenario of a no-deal Brexit, the Bank of England may cut the interest rate from 0.75% to give a boost to the economy – which could see mortgage rates remain low when you come to re-mortgage. This would suggest a 5 year fixed term would not be only sensible option for somebody buying today. Buyers may benefit from the lower interest rates made available on two-year fixed rates in the years to follow.

 

On our above calculation for November 2019’s two-year interest rate of 1.44%, this would decrease your monthly outgoings to £695 per month.

 

The total you’ll repay over full term (Includes mortgage debt, £175,000 + total interest £33,501) £208,501

 


Most of us don’t think about our credit history on a daily basis, trying to meet our financial obligations on time. Meanwhile, the low credit score may be down to failure to pay bills on time or having a high levels of existing loans compared to your income and expenses.

The costs of low or poor score can be high. Lenders always check the client’s credit report when they apply for a mortgage. A bad or too low rating may result in charging higher interest rates, worse credit terms or even rejecting the application.


Family income benefit (FIB) is a type of affordable life insurance that helps take a load off the client’s mind that, in the event of an unexpected, their family would also have to deal with financial problems. This protection ensures regular income for your loved ones if you die during the term of the plan. The total amount paid by the policy depends on when the customer dies.

Family benefits can be particularly attractive for young families who want to secure their children until they reach the age of majority. Such insurance is also beneficial for customers who have a mortgage, as well as for single parents and carers of children and adults, where regular income from the benefit could cover the cost of renting an apartment, medical care or current bills.


How to buy or sell the council house you live in.

 

Council Housing: The Right to Buy

 

You have a right to buy a council home at a discounted price under the right to buy for secure tenants. If you qualify you can buy your house by yourself, with a spouse or civil partner or other joint tenant, you also have the option to share this with up to three family members who have lived in your home for a more than 12 months.

Who qualifies for the right to buy? You must be either a secure tenant or a flexible tenant. You must have been in council housing for at least three years in total. It doesn’t have to be continuous or in the same property as time spent in the armed forces accommodation also counts.

Other homes also may not qualify for your right to buy such as sheltered or adapted properties or homes that are due to be demolished within two years.

 

The Maximum Discounts

 

If the property is a house or a flat and when the landlord has spent money building or refurbishing your home in the last 15 years the maximum discounts available are £82,800 in most areas and £110,500 in London. This maximum discount increases every April in line with the consumer price index.

 

There are different discount levels for houses and flats. (credit: gov.uk)

 

Houses:

 

You get a 35% discount if you’ve been a public sector tenant for between 3 and 5 years.

 

After 5 years, the discount goes up by 1% for every extra year you’ve been a public sector tenant, up to a maximum of 70% – or £82,800 across England and £110,500 in London boroughs (whichever is lower).

 

Flats:

 

You get a 50% discount if you’ve been a public sector tenant for between 3 and 5 years.

 

After 5 years, the discount goes up by 2% for every extra year you’ve been a public sector tenant, up to a maximum of 70% – or £82,800 across England and £110,500 in London boroughs (whichever is lower).

 

You can use your discount against your deposit.

 

Many mortgage lenders will now accept this discount as a deposit, meaning you won`t necessarily need to save up as a private purchase would.

You can borrow extra funds for home improvements under the right to buy scheme.

 

 

Housing association: The Right to Acquire

 

Housing association tenants also have the right to buy under the right to acquire their home under a different scheme with smaller discounts and this can be checked with your landlord. Valuation and discounts underwritten by your landlord will assess the value of your home and therefore work out the discount you are entitled to and this depends on how long you’ve been in a council or housing station home as a tenant.

Your landlord has four weeks to respond to your application if you’ve been attended for more than three years and eight weeks to respond if you’ve been attended for less than three years and they also must give you reasons if they say you do not have a right to buy.

 

The maximum discount for a housing association – right to acquire is usually £9000. You need to check with your housing association to confirm discount available.

 

You can use your discount against your deposit.

 

The right to sell your home.

 

If you are selling a council home within ten years of buying it through a right to buy a scheme you must offer it first either to your old landlord or to a social landlord in the area. They may accept your offer or refuse to buy it from you, in which case you can offer the property for sale on the open market. The property should be sold at full market price agreed between you and your landlord.

If you cannot agree this, a valuer will say how much your home is worth and set the price. You will not have to pay their valuation.

You’ll have to pay some or all of your discount back if you sell your home within five years of buying it through a right to buy scheme.

 

You must pay all of the discount back if you sell it within a year after that it’s totally amount reduces back to the following:

 

80% of the discount for the second year

60% of the discount for the third year

40% of the discount for the fourth year

20% of the discount for the fifth year

 

Costs of buying properties under Right to Buy or Right to Acquire.

 

Solicitor fee which also includes Searches and Land Registry Fees. Depending on type of property and solicitor it can range from around £1,000 to £2,000. Some lenders allow to borrow up to £500 to help with legal costs.

Mortgage arrangement fee – This depending on lender and your circumstances but typical cost is £995 which can be usually added to the mortgage.

Broker fee- Our cost is usually £699

 

 

How to apply for Right to Buy or Acquire?

 

You need to obtain the application form from your landlord and bring it together with proof of ID and address as well as mortgage in principle at appointment arranged with the landlord. This is usual process in most housing associations and councils. To be in best position speak to our mortgage advisers for guidance.

 

This article is also available in Polish:

Jak kupić lub sprzedać dom komunalny, w którym mieszkasz.


Should I get mortgage advice?

Lenders (usually banks or building societies) and brokers must offer advice when they recommend a mortgage deal.

Usually the process is simple. The lender or broker will assess the level of mortgage repayments you can afford, by looking at your income as well as your outgoings, such as a finance agreement on a vehicle, credit card balances or personal loans and any regular spending. This information will produce amount of mortgage that is achievable based on the given circumstances.

An applicant can elect to research their own mortgage without advice. This is called an “execution-only” application.

 

What is a mortgage broker?

A mortgage broker acts as an intermediary who arrange mortgage loans on behalf of individuals or businesses.

 

Risks of not getting advice from brokers or mortgage advisors:

Being rejected by lender:

This may be due to not suppling enough or accurate information.

Getting wrong mortgage for a specific personal or financial situation:

This could cost thousands of pounds

Agreeing to the wrong mortgage type:

Please see our articles on mortgage types for more information.

 

Reasons for getting advice

A financial advisor or broker will:

  • check the applicant’s finances to make sure they can afford a mortgage
  • Offer exclusive deals with lenders, not otherwise available
  • Complete the paperwork for you, so the application should be dealt with faster
  • They’ll help take all the costs and features of the mortgage into account, beyond the interest rate
  • Only recommend a mortgage that is suitable and will advise on what deals are likely to get.

 

JP-Finance are independent brokers with access to a comprehensive range of mortgages. This means we are not tied to specific lenders and often are able to offer better deals than offered by lenders directly.

JP-Finance are experts in their field and help to find the very latest deals and have in-depth knowledge of the habits and anomalies of different lenders. We do the searching for the applicant and liaise with the chosen lender, which saves a large amount of time and stress.

We can advise which lenders complete the processes the quickest or are affordable based on the applicant’s income and outgoings. JP Finance understands how lenders take certain expenditures into consideration during your affordability assessment.

 All mortgage advisers must offer advice when recommending the most suitable mortgages.

This means the applicant is protected and can complain to the Financial Ombudsman if things go wrong.

 

 


Understanding different types of mortgage options:

 

Fixed rate mortgages:

What is a fixed rate mortgage?

The mortgage payments remain the same for the period of the loan, even if interest rates changed.

Disadvantages

The homeowner is tied in for the length of the deal, so if interest rates fall, there is no advantage to the homeowner. For example, a five-year fixed-rate deal remains until the fixed term ends. To exit the mortgage before end of the term often incurs high charges.

Variable rate mortgages:

What is a variable rate mortgage?

With variable rate mortgages, the interest rate can change at any time.

Variable rate mortgages come in various forms:

 

Standard variable rate (SVR)

This is the normal interest rate your mortgage lender charges homebuyers and it will last as long as the mortgage or until the homeowner takes out another mortgage deal.

Changes in the interest rate might occur after a rise or fall in the base rate set by the Bank of England.

 

Advantages

  • Freedom – the mortgage can be overpaid or left at any time

Disadvantages

  • The rate can be changed at any time during the loan

 

Tracker mortgages:

What is a tracker mortgage?

The interest rate on a tracker mortgage is linked to the Bank of England base rate. So if the base rate changes, the mortgage rate will change.

As with fixed rate mortgages, trackers are available over different terms: most commonly two or five years. With these deals, the home owner will be charged a penalty if they opt out of the mortgage during the term of the deal.

Lifetime, or term, trackers are also available, and these are often completely penalty free so they are very flexible and can be a great option to not be tied into the mortgage lender or deal.

Advantages

The rates on the leading tracker mortgages tend to be lower than on fixed rate deals.

Although trackers are variable rate mortgages, it’s easy to understand what rate the homeowner will be paying because they are directly linked to the base rate. Therefore, the rate, and the monthly payments, will only change if the Bank of England changes the base rate.

Disadvantages

These don’t have the same security with a tracker that you get with a fixed mortgage because the rate is variable. This means the homeowner must be prepared for the fact that their monthly repayments could go up. If money is tight, a fixed rate mortgage will probably be a better option.

 

Discount mortgages:

What is a discount mortgage?

Discounts are another form of variable mortgage. However, unlike trackers the interest rate isn’t linked to the Bank of England base rate. Instead, it’s linked to the lender’s standard variable rate (SVR) and this is a significant difference because lenders can change their SVR even if there has been no change in the base rate.

Discount mortgages are available over different terms – typically one to five years – and as with trackers and fixed rate deals, the homeowner will probably be charged a penalty if they want to get out of the deal during the term.

Advantages

  • Cost – the rate starts off cheaper which will keep monthly repayments lower
  • If the lender cuts its SVR, the homeowner will pay less each month

Disadvantages

  • Budgeting – the lender is free to raise its SVR at any time
  • If Bank of England base rates rise, the homeowner must be prepared for the fact that their monthly repayments could go up.