The impact of Covid-19 has been colossal to say the least. Before the crisis you may have been thinking of buying a home and have since been put on furlough. If you’re wondering what affect this will have on your chances of getting a mortgage, we spoke to Stephen from Money and Mortgages to ask for his professional opinion.
The good news is being furloughed does not necessarily mean that getting a mortgage is off the table but it’s not plain black and white…
Can I still get a mortgage if I have been furloughed?
“Mortgages are still available to people who have been furloughed but it may not necessarily be the lender you had in mind originally. Some lenders are only lending up to 85% as standard. Anyone who originally thought of a 10% deposit may not be able to get one going through their bank or building society or through a normal route, however it is possible to look at.”
My application for a mortgage had been approved but I have since been furloughed. What happens now?
“If you had a mortgage that has been approved previously, it depends how far along this would be in the process. It is always best to let the lender know of any changes and they would usually state this in an offer. However, some lenders have stopped proceeding with borrowing to new customers just because they have not had the capacity to do valuations, or enough staff to complete the new lending. They have preferred to keep good service levels instead. They are slowly coming back into new lending but there are a couple lenders still to come back. It maybe that a few people are waiting on the lenders to make a decision or continue with a full application because of this.”
I need some advice, what should I do?
“I would say now if any is the best time to speak to a mortgage broker just because so much is changing at the moment in the lending market. It is different from one day to the next. We are keeping an extremely close eye on everything that is happening. We all need to be up to date on the relevant markets. We do sometimes have the ability to speak to an underwriter directly also, if it is anything slightly out of the normal criteria, we may be able to get this accepted.”
Lenders are reviewing each situation and as Stephen pointed out you may need a larger deposit than originally anticipated. The best thing you can do is contact a mortgage broker. Money and Mortgages work with over 50 lenders, all who have different criteria when it comes to lending right now. They can go over your unique circumstances and offer bespoke advice as well as help you find the best lender available.