To help give you more information and guidance on our Mortgage products, we’ve put together answers to the following Frequently Asked Questions.
What locations do you lend in?
We lend across the whole of mainland England & Wales. Some products may have postcode restrictions.
What’s your Standard Variable Rate?
The Society’s Standard Variable Rate is currently 7.49%
What’s the maximum you will lend?
The maximum we’ll lend to you will depend on your individual needs and circumstances and the terms of the mortgage product. You can use our mortgage calculator which is designed to show you how much you could potentially borrow, which products are available to you and how much your monthly payments would be.
What’s the minimum term of employment or self-employment?
Self employed applicants who have three years of accounts are eligible for our standard mortgage products.
For those who are employed we’ll consider any term of employment.
Will you lend on Right to Buy cases?
Yes, subject to the Right to Buy papers being in the applicants name.
Will you consider Guarantor mortgages?
No, however, the Society does offer joint borrower sole proprietor mortgage (JBSP) which allows additional people (non-owning joint borrowers) to be added to a mortgage while only the owner-occupier(s) (proprietors) are named on the deeds and therefore on the proprietorship register. The non-owning joint borrower will be ‘jointly and severally’ responsible for the mortgage payments and for obliging by the terms and conditions of the mortgage.
Are there any age restrictions for applicants?
Minimum: 18 years
Maximum: There is no maximum age to which we’ll lend. As a responsible lender, we of course do need to consider the ability to pay the mortgage both at the time of application but also at the time when income may be reduced such as when in retirement.
Borrowing in Retirement Mortgages
Applications for Borrowing into/in Retirement products will only be accepted from applicants who are already over the age of 80, or whose required mortgage term will take them beyond age 80.
Minimum: 25 years
Maximum: 80 year
What costs/fees will I have to pay?
There are certain costs involved in taking out a mortgage:
Completion fee (where applicable)
This is a fee charged by the Society to cover the administration costs in arranging a mortgage. If you wish, you can choose to add this fee to your mortgage account (subject to loan to value limits). However, you should consider carefully before adding any fees to your mortgage as these will incur interest charges at the rate of interest applicable to your mortgage account.
These fees will normally depend on the size of the property and will include a Land Registry fee, the solicitors own conveyancing fee plus other charges and expenses known as ‘disbursements’.
Higher lending charge
A Higher Lending Charge normally applies if you want to borrow more than 80% of the property’s value and provides indemnity insurance to protect the lender against any future loss if, for example, if you go into arrears with mortgage payments or your property is repossessed. The Higher Lending Charge will normally be provided free on our products.
Before we can make a lending decision, we’ll need to value your property. There are three types of valuation available:
This is a basic valuation of the property and is for the lender’s benefit only. It enables the lender to decide whether the property is suitable for lending purposes.
This report is a more detailed inspection of the property than a standard valuation. You’ll receive a report on the condition of the property, stating any repairs or defects that need attention.
Full Building Survey
This survey is the most comprehensive type of report and is a thorough and complete inspection of the property and its structure.
If you’re buying a property, you will need to pay local search fees. A search provides information about your property and immediate neighbourhood, which may affect your decision to purchase the property. Your solicitor will normally arrange for these to be carried out.
What is Stamp Duty?
Stamp duty is a tax payable by the purchaser of a property. It’s collected by the solicitor/conveyancer prior to the sale completing and is charged at various rates.
You can find the most up to date rate of stamp duty payable on the government website here.
What documentation will be required to take out a mortgage?
You’ll need to provide:
- Your last three month’s payslips and latest P60 or your latest accounts / SA302 documents if Self Employed
- Your last three months bank statements
- Your most recent mortgage statement
- Copies of your driving licence or passport.
If any additional documentation is required, we’ll let you know.
What repayment methods are available?
Capital repayment mortgage
This is most common repayment method which is also known as capital and interest or repayment. Your monthly mortgage payment is made up of part of the amount borrowed plus interest every month. Providing all of the monthly repayments are paid in full and on time, you’ll gradually pay off the entire mortgage.
Interest only mortgage
The monthly payments you make only cover the interest on the loan. At the end of the mortgage term you’ll still need to pay back the amount you borrowed via a suitable repayment plan e.g. (Endowment policy, ISA or Pension.)
Part and part mortgage
This is a combination of capital repayment and interest only. Part of your mortgage is on capital repayment which will be paid off at the end of your mortgage term. The other part is made up of interest only where you’ll need to ensure that you have a repayment plan in place in order to repay the amount you borrowed at the end of your mortgage term.
If I move house and take out a new mortgage with the Society, would I have to pay the Early Repayment Charge?
If you move house, you may be able to transfer your current mortgage to your new house subject to meeting the Society’s lending criteria, and the completion of the sale of your existing property and the purchase of your new property take place on the same day, the Early Repayment Charge may be waived.
If you take your mortgage with you to a new property, and there’s a delay between the sale of your property and the purchase of your new one, the Early Repayment Charges must be paid, however, if you can transfer your current mortgage to a new property within 180 days of that date, your ERC will be refunded in full.
If you only take part of your existing mortgage with you to your new property, you may be charged an ERC on the part that you don’t take with you.
Do you carry out a credit search if I want to apply for a mortgage?
Are there any types of property you don’t lend on?
How do I find out how much I owe?
You can find out the balance on your mortgage account by calling us on 01509 631961 or by emailing us at [email protected]
Alternatively, if you plan to redeem your mortgage you’ll need to request a redemption statement.
The statement will be sent to the correspondence address registered on your account.
I’m in the Armed Forces, can I rent out my house while I’m posted overseas?
Yes, The Loughborough is committed to supporting the Armed Forces Covenant.
If you have a question which is not answered in the above FAQ’s or if you require any further information or guidance, please get in touch here.