Even on Furlough, lenders may consider you for a mortgage

Just because you’re on the Furlough Scheme (or have been on it), does not necessarily mean you cannot get a mortgage. Several lenders have issued guidelines to accommodate those on Furlough and will offer mortgage products to them. Especially clients looking to stay with the same lender and do what is called a ‘product transfer’. As with all instances, you should speak to a professional broker who can review the whole market. Staying with your current lender might be the easiest option, and a broker can arrange this for you, but it does not necessarily mean it will be the best rate and option available to you. Always shop around, loyalty to lenders should be the least of your priorities as they may not be loyal to you!

This also relates to mortgage payment holidays. A number of lenders have advised they will consider clients who have taken a mortgage payment holiday, depending on their circumstances. However, many have said they will not assist if the client is still in the mortgage payment holiday so check the lender’s requirements. And we’ve been made aware of instances where a client has applied to a lender for a mortgage payment holiday, whilst also applying to purchase a new property for investment! This was not taken lightly by the lender and the mortgage payment holiday had to be repaid before the new mortgage could proceed. Mortgage payment holidays really are for those who are having difficulties in the current climate.

We’ve also had recent updates from lenders who will look in detail at self-employed clients who have taken out Bounce Back Loans and CBILS funding. Both cannot, in the main, be used as a deposit for purchasing premises and the lender will want to look at the self-employed clients cashflow forecasts, management accounts and really understand the impact of COVID-19 on their businesses, specifically with regards to how income will recover in the short to medium term.

Finally, the higher loan to value market is like the ‘hokey cokey’. Some lenders are in, some are out, some are back in and so on. One lender even launched a 90% lending product for just 48 hours. Another has launched a ‘tranche’ of funds for the month. Once it has been used up, that is it. This is the benefit of using a broker as we will know what lender will offer such products and monitor the very strict deadlines to ensure you get the right deal for your circumstances.