Tagged in: UK

Why Do I Need Life Insurance to Get a Mortgage

Taking out a mortgage is one of the most common ways people get into a home in the United Kingdom. Every mortgage lender has a set of requirements borrowers must meet, however, such as having a certain debt-to-income ratio. Although UK law doesn’t force you to get life insurance to take out this type of loan, most mortgage lenders include it in their requirements, and almost all financial experts believe that having a policy to accompany your mortgage is prudent.

What Happens to the House After You Die

To really understand why life insurance with a mortgage is so overwhelmingly seen as necessary, you have to grasp what would happen to your home following your death, assuming the mortgage was still not paid in full. Under UK regulations, if your mortgage is unpaid, several things can happen. If you have a joint mortgage, then responsibility for the mortgage simply passes to your surviving borrower. If you are the sole owner of the house through the mortgage, then the home usually goes to a beneficiary you name in your will, but your estate must settle your debts before beneficiaries can get the property. If there are enough other assets in your estate to pay off the mortgage without selling the home, then the beneficiary might be able to get the property free and clear, but more often than not, the assets don’t entirely cover what’s owed, so the beneficiary has to refinance the mortgage loan to keep the property. Remaining owners and beneficiaries can sell the property, pay off the mortgage from the sale, and pocket whatever equity happens to be left over, as well.

The Lack of Payment Problem

In the scenarios above, all is well assuming that the remaining owners or beneficiaries have the means to pay off what’s still owed on their own. This is not always the case, however. For instance, a parent might not be able to cover both the costs of the mortgage and daycare. Similarly, many beneficiaries are not financially prepared to take on a mortgage payment. If the mortgage payments lapse enough, the lender may foreclose.

Enter the Life Insurance Policy

When you have a life insurance policy to cover the remainder of your mortgage, you eliminate the possibility that your surviving borrower or beneficiary will have trouble paying off the rest of the loan. They can take the insurance money and give the lender what is still owed without having to make tough financial sacrifices to keep the property. The fact they don’t have to worry about the mortgage payments does wonders to keep them monetarily stable, because all of the money they would have had to put toward the mortgage can go toward other needs or wants, or better yet, be invested. A life insurance policy coupled with a mortgage loan, therefore, is a very responsible way of eliminating worry, allowing your surviving borrowers or beneficiaries to maintain a good standard of living and retain a valuable asset.

A Note on Death in Service Benefits

Many people make the mistake of thinking that Death in Service benefits are a form of life insurance. This is not exactly true. Both are similar in that they pay out upon your death, but Death in Service benefits normally max out at four times your salary. You can lose them if you lose or change jobs, or if you are made redundant. By contrast, you can get insurance in a wide range of values, and they aren’t dependent on your employment. These differences mean that most lenders see insurance as the most reasonable way for a borrower to reduce risk, and that they often still want you to have a policy even if your employer gives Death in Service benefits to you.

Conclusion

Mortgages allow many UK residents to purchase a home without paying for it in a lump sum. If you pass away before you eliminate your mortgage loan, surviving borrowers or beneficiaries might have difficulty keeping up with the mortgage payments. A life insurance policy ensures that they don’t experience undue hardship to keep the home, or that the house has to be sold. This is why, if you ask -Do I need life insurance to get a mortgage?-, many experts will say you -have- to have it, even though getting a policy is not required as of 2013 under UK law. If you are single with no dependents, then life insurance becomes less vital, but you still might need to get it based on your preferred lender’s stipulations.

Laura Ginn appreciates that there are many people that are asking -do I need life insurance to get a mortgage?’ Visit http://www.uswitch.com/life-insurance/life-insurance-tips/ to learn more about life insurance and what it means in relation to your mortgage application and other areas of your life.

The benefits of using an experienced mortgage broker

Foreign nationals now have a choice of mortgage products and with help from an experienced mortgage broker they do not have to worry about the additional rules, restrictions and stipulations imposed by lenders.

If you have been working in the UK for at least a year and seek to purchase your first property, you may want to consider a foreign national mortgage. Rather than continue paying exorbitant amounts as rent, it is always prudent to seek the services of an experienced mortgage broker who will be able to identify the most suitable lender.

The risks of approaching lenders on your own

Many foreign nationals may approach their existing bank only to be turned down. In most cases, this is because they do not present their application in the appropriate manner. Therefore, it is wise to have an experienced broker guide you through the process even if you plan to start a large buy to let portfolio. Some lenders accept applicants who have at least two years remaining prior to the expiry of their visa. This restricts the borrowing limit while most lenders fail to recognise the visa process that permits an individual to be considered for indefinite leave to remain in the UK permanently after their visa term is complete.

Guarantee better rates with a mortgage broker

However, there are mortgage brokers that have the skills and resources to procure foreign national mortgage from specific lenders. One of the major benefits is you can have access to a range of mortgage products that do not attract any set-up fee. In addition, depending on your situation, you may be able to find lenders willing to loan as much as 90% and reduce your immediate financial burden to just a 10% deposit. It would be prudent to opt for an existing house or flat rather than build a new one. This increases the potential to borrow more since several lenders perceive any plan for new construction as a greater risk and restrict their borrowing limit.

Mortgage brokers enjoy a better rapport with lenders

Other major factors to consider are the source of the deposit and the costs involved. Lenders are wary about the origin of deposits especially when they come from abroad. Policies differ from lender to lender especially when it comes to anti-money laundering measures. However, your mortgage broker will be able to ease their concerns and reach an appropriate solution. For the most part, there are no initial costs involved since reliable mortgage brokers do not charge an upfront fee for their service. The percentage of deposit owed to the lender is the only major cost involved.

Reliable mortgage brokers are transparent when it comes to fees, costs and rates. Their service fee is applicable only if your loan has been approved. Whether you wish to build a large buy to let portfolio or are a foreigner seeking a mortgage, you can always count on an experienced mortgage broker for help. Visa applicants can have access to the Best Buy 90% mortgages. This includes Tier 1 and Tier 2 visa holders, first time and second time buyers, remortgages as well as employed, self employed individuals and contract workers in the UK.

Author is associated with a Loan providing company in London. They are able to arrange short term and long term property loan to fulfill your need; Here, He keen to provide detailed information on foreign national mortgage along with large buy to let portfolio to choose best mortgage provider that suits your need.

What Is A Buy To Let Mortgage

Buy to Let Mortgages are loans specially designed for anyone who wishes to invest in the property market by buying one or more houses and renting them out to tenants. Buy to Let Mortgages differ from previous investment vehicles by specifically using the rental revenue as the main factor when determining the ability of the buyer to meet the monthly mortgage payments. Many high street banks and building societies now offer a buy to let mortgage product. The percentage which the buy to let lender is willing to lend is likely to be restricted by many lenders to 85% of the value of a property.

Buying Property

Buying property to let has become increasingly popular to the UK investor. Buy To Let mortgage lenders differ in approach. Buy-to-let borrowers do have to jump through some extra hoops to satisfy mortgage lenders. The buy to let mortgage term can be anything between 5 and and 45 years. When buying to let it is important to know the market in which you will be trying to let your property.

Buy To Let Property

The more you are willing to do a property up, the higher the potential profits. There is the danger that the property could lie empty for long periods and the market could suffer a downturn. There is a real advantage if your buy to let property is close by as you will be able to manage the property yourself. However, if you are employing the services of an agent then the vicinity of your properties is not a real consideration. One rule of thumb many buy-to-let investors apply is to factor in the property sitting empty for two months of the year this gives a substantial buffer. Finding the right property is key to the success of your long-term strategy.

Buy To Let Mortgages

Popular perception is that buy-to-let mortgages are hugely expensive and very restrictive. However, the interest rates available for buy to let products is really not that much higher than a regular residential mortgage. Landlords also have a choice between interest only and repayment mortgages. To begin with, buy to let mortgage lenders do not use the applicants income solely as a basis of approval, instead they base their decision mostly upon the likely rental income that the property will achieve. Over the long term, though, both the capital value of the property and the rental income should go up, making buy-to-let a balanced investment. Usually, regular buy to let lenders will demand the rent to cover at least 125% of the monthly mortgage payments. However some specialist lenders are more relaxed and may only require 100% full coverage.

Buy to Let mortgages are not regulated by the Financial Services Authority. Even though buy to let property is a fairly safe investment taking into consideration the historical movement of house prices, you still need to check the market very carefully before going ahead with a purchase.

Dyson Vs Hoover – The Value Of Intellectual Property

Most people have heard of a Hoover, but almost as many have now heard of a Dyson, too, as the brand has become synonymous with innovation in vacuum cleaning, and in other household products, too.

Dyson’s success – the company now has more than a third of the UK market for vacuum cleaners – has not been without conflict. One major factor in its advance has been make sure that its product innovations – in combination, the company’s intellectual property – were carefully protected.

Legend has it that James Dyson was inspired by the air extractor at a coating plant, and used this inspiration to create his famous cyclonic vacuum cleaner. The initial frustration that made him look for a new idea was how the efficiency of his regular vacuum cleaner decreased as dust filled its bag.

Dyson had the good sense to consult an experienced intellectual property (or IP) lawyer who advised him to ensure his new technology was patented. And, thanks to that important step, he was in the ideal position to be able to defend himself against a much larger rival, when they developed a product that looked remarkably similar to his cyclone vacuum. That rival was Hoover, who Dyson took to court in 2000 to sue them for patent infringement. It is understood the successful claim meant around $5 million in damages – but more importantly, it stopped Hoover and others from copying the Dyson design and ensured his leading design had no clear rivals in the marketplace.

Hiring a specialist IP lawyer as Dyson did will make sure you are informed about the best way to protect your intellectual property, whether through use of a patent, or another route such as registering a trademark or a copyright. It is vital to seek advice and take action early; had Dyson waited until his first model was selling well, he could have laid himself open to having his proprietary design copied, without any legal protection or comeback against those benefiting from the sales of a product with a similar design.

With patents, the rules of patentability are specified by the law, with certain discoveries disallowed from the process. These exemptions include items already existing in nature, scientific theories, and some diagnostic methods. And to qualify, a new product must be capable of actual manufacture; and it has to be obviously new.

Taking advice on your intellectual property from an experienced, qualified IP Lawyer is hugely important when considering whether a patent is the best way forward for you, as well as when making sure that you have filed the documents properly and so afforded yourself the best commercial protection. Taking the right IP advice could mean your invention turns you into the next James Dyson!

Various Uses Of Mortgage Calculators

Much like common mathematical calculators, a mortgage calculator is a small handheld device to compute the total payment of a mortgage loan, including principal, interest, taxes and insurance with relation to the repayment schedule such as quarterly, monthly or biweekly. The instrument can also used to calculate the amortization schedules, balance on the mortgage taken, and the future value of a mortgage. Not only that, some mortgage calculators have rent-versus-buy features to analyze which of these two options would be better in the long term. Most mortgage calculators also do currency conversions and tax calculations.

A calculator can come in quite handy, since you can take it with you to meetings with your realtor or builder, to crunch the numbers as you go through the purchasing process. The Internet will provide the easiest use of a home mortgage calculator, since you can simply punch in the information necessary, and the computer will do all of the hard work for you.

The keys are similar to ordinary mathematical calculators having numeric keys from zero to nine. Similarly, there are related symbols for functions such as addition, subtraction, multiplication, division, percentage and so on. They have integrated circuitry within their bodies and are operable with one or two 1.5-volt pencil cells. Since mortgage calculators are used for quick calculations, their buttons are usually larger in size than normal calculators. Depending on the quality and various features, they may be priced between 10 to 50 UK pounds.

To use a mortgage calculator, you simply need to know the approximate purchase price of the home that you are interested in, and the current rate of interest available for a loan in that amount. You can find out how much your monthly mortgage payment will be, which will give you an idea of how much house you can afford. You can also use a mortgage calculator to determine the annual income that will be required to purchase a home in a particular price range. To utilize this type of mortgage loan calculator, you will need to know the amount of your monthly expenses, as well as the purchase price of the loan and the interest rate.

There are plenty of commercial mortgage calculators on the web which you can use free of charge. All you need to know is your mortgage amount, the down payment, interest rate, and the number of years. You will get your monthly payment calculated for you by simply putting those numbers into the commercial mortgage calculator. Often, companies will create free tools for you to post on your website in exchange for a small link back to them. This will save you time and money in creating your own web tools or calculators, which can often be expensive. There are any numbers of websites on the Internet that will provide this service for you, and a number of calculators that you can purchase that will provide this functionality.

Thus, a mortgage calculator is an efficient tool to help you calculate how much money you can afford to pay on a mortgage and to have a price range in mind before searching for a suitable home and loan option. If you are thinking of refinancing your current mortgage loan, a mortgage calculator can be a great tool for you. For this, you need to know what your existing mortgage loan balance is, the current commercial mortgage interest rate, and number of years you wish to refinance your commercial mortgage loan.

Top Reasons For Buying A Property Abroad

There are several reasons why people choose to buy a second property abroad.

Ownership of property outside the UK is increasing in popularity. Fuelled partly by lower house prices and better climates, and made more favourable still by low-cost airlines, the appeal of a second property abroad is understandable. Once the preserve of the rich, a holiday home in Spain, Portugal, France or anywhere in the world for that matter, can now be acquired easily by the majority of the UK population.

There are three top reasons that people choose to buy a property abroad:

To live permanently in a new country

Some people move abroad for work, whilst others choose to retire outside the UK. Moving to a new country on a permanent basis is a challenge and a risk, and so many people choose to buy a property abroad, whilst keeping their UK home and renting it out. This means that they have somewhere to come back to should things not work out as planned. For many, moving to a new country is one of the best experiences of their life. The chance to live in a new culture; learning the language, eating new foods and soaking up the sun, is exactly what people are looking for.

To have a permanent holiday base

Some people like nothing more than the security of having a permanent holiday base. You know where to go, what shops are available, where the best beaches are and what attractions are nearby. You dont have to waste any of your holiday time getting acclimatised and your accommodation is a home-from-home. Whats more, you can visit it as often as you like throughout the year, and you can invite friends and family to come along and enjoy the holiday with you, or lend it to them so that they have a ready-made holiday base of their own.

To rent to other holidaymakers

Many people choose to cover the costs of buying and running their property abroad by renting it out. There are two main ways to do this; hiring an agent to rent the property on your behalf, or handling all the rentals yourself. An agent will take a percentage fee, but will handle all the bookings, cleaning and maintenance of your property. If you manage the rentals on your own, you will need to find someone trustworthy who can clean and prepare the property for your customers and handle any issues that arise when people are staying in your property. Renting is a very effective way to cover costs, and even to make a profit, but you have to limit the times when you can use the property and be prepared for damage and wear and tear to increase.