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Which?’s Best Refer A Friend Scheme

GIGLY are delighted to announce that we were featured in Which?’s ‘Best Refer a Friend Schemes’ 2018.

We understand that there is no higher praise than you recommending us to your friends and family so our ‘Get £25, Give £25’ referral scheme is our way of saying thank you.

With GIGLY, you can earn a £25 voucher of your choice* for referring a friend to GIGLY who successfully completes a mortgage. You don’t have to be a GIGLY customer to refer a friend and you can refer as many people as you like.

How Does it Work?

We will send you an email to forward to your friend as an invitation and a unique link, so we can track your referral. Once your friend or family member has a successful mortgage completion we will notify you and send you a voucher for £25 of your choice, and your friend will get one too!

You will both receive your reward within 30 days of your referral completing on their mortgage deal.

Putting the Gigger First

Your first mortgage can be a daunting idea and re-mortgages, a dreaded task. If you work as a contractor, freelancer or PAYE in your own business, it can feel like you have more hurdles to jump than others.

Sweat no more. Our GIGLY advisors are always on hand to guide you step by step, making the entire process clear and simple. We match contractors, freelancers, self-employed and independent professionals to experts in gig mortgages. Although, we cannot offer mortgage advice, we can put you in touch with our advisors who are regulated by the Financial Conduct Authority (FCA) to help find you the best mortgage available.

See our Terms and Conditions here.

*Voucher options include: Amazon, Marks and Spencer, iTunes, Costa, Spotify or TicketMaster.

How much do mortgage advisors charge?

Mortgage advisors charge fees in a variety of ways, so it is important ask them the question from the outset. Here are the different ways they may charge.

  1. Fixed Fee
  2. Fee Free
  3. Hourly Rate
  4. Commission
  5. Percentage
  6. Combination

There are, however, a number of different options out there so it is important to discuss these with your mortgage advisor first.

Fixed Fee

Your adviser will agree to arrange your mortgage for a fixed amount of money. This should be agreed in writing so there isn’t any room for dispute.

Fee Free

Not all mortgage advisors charge for their financial advice. At GIGLY, we only work with independent financial advisors who do not charge customers a penny for their service.

Instead of charging customers we get a percentage of the procuration fee from the lender if the mortgage goes through. It’s important to note, that all financial advisors get this fee, some just happen to charge an additional brokerage fee on top. Some advisors work on the basis they charge a fee but they refund the proc fee to the client (see Combination below).

Hourly Rate

Some advisers will charge per hour so you should have an estimate upfront of how long it is likely to take for the advisor to find you a mortgage and guide you through the application process.

Commission

All mortgage brokers receive a commission in the form of a procuration fee from the lender once a mortgage has completed. Fee free mortgage brokers use the procuration fee as their primary income source and do not charge an additional fee on top of the procuration fee. Make sure you ask about it right at the start and check if the broker you are talking to is on a limited panel or is whole of market.

Percentage

Some advisers will charge you a percentage of your mortgage. For example, if you agree a 1% charge for a £300,000 mortgage, the fee will be £3,000. Some advisers will cap fees to a certain percentage.

Combination

Some advisers will charge fees but still receive commission. Others will charge fees, but agree to cap them at a percentage of the mortgage.

There are a number of mortgage advisor combination fee options;

  1. An adviser will charge fees for researching the market and providing advice payable from the onset and receive a commission from the lender
  2. An adviser will charge a fee when you apply for the mortgage and then refund any commission they receive from the lender.
  3. An adviser will charge a fee on receipt of your mortgage offer and then refund any commission they receive from the lender.
  4. An adviser will charge a fee on completion of your mortgage and then refund any commission they receive from the lender.

How much?

As mentioned above, a mortgage advisors fees can be charged a number of different ways and are determined by the size of the mortgage. On average, mortgage advisors are generally paid around £500 – £600 for their fixed fee, with other costs – such as percentage of the loan added after completion.

When Do I Pay My Fees?

Mortgage advisors can be paid at different times. At your first consultation, they should thoroughly communicate with you at which point in the application process you are expected to pay and the exact costs.

Liability

If you have received advice from a qualified mortgage advisor and any such problems arise after this service and can be directly linked to the broker’s service, you can be confident that the liability will not lie with you.

Ultimately, this is why it is so important to use a mortgage advisor when applying for a mortgage. Their advice and experience are invaluable. Always check with any broker you are considering using how much you will be charged and make sure you have this information in writing before you proceed.

Read our blog on 9 reasons to get independent mortgage advice.

Gig Economy Income To Count For Remortgages

Airbnb Hosts to get Help to Lower their Mortgage Rate

If your side-gig is to rent out your property on Airbnb, the money earned as income for a year or longer will be counted when it comes to refinancing your home.

In the US, the Federal National Mortgage Association known as Fannie Mae, has announced a partnership with three major American lenders, Quicken Loans, Citizens Bank and Better Mortgage, to offer Airbnb hosts a new way to remortgage their home.

The program will let anyone who’s rented out property on Airbnb for a year or longer count some or all of that money as income.

John McHugh, CEO of GIGLY, said

“This is big news for hosts generating income from Airbnb, and we’d like to see the UK follow suit. Currently being an AirBnB host is still fairly taboo in the eyes of UK lenders, unless you reside in the property with your AirBnB guests. Clearly this doesn’t suit all scenarios. Giggers who are generating income from their property asset need more innovative products from their lenders. If a homeowner has sufficient insurance why shouldn’t they be allowed to generate income from their property on a short term basis with AirBnB?

In the UK, people looking to become a host may find they are in breach of the mortgage lenders. In August 2017, Which.co.uk asked high street banks whether listing a property with a residential mortgage would be a breach of their mortgage terms and condition. Royal Bank of Scotland, Nationwide, Santander, Lloyds and Nationwide had varying responses; from the need to apply for consent to let, which would include paying a fee right through to a straight forward no from Nationwide if the property is the owners only residence.

To give UK lenders credit, we have been pleasantly surprised by some new products that have launched in the last 12 months, which have allowed giggers to secure a mortgage based on their contract status.

Coverage of the Airbnb & US lenders partnership

The Wall Street Journal explained that “Homeowners soon will be able to count income they earn from Airbnb Inc. rentals on applications for refinance loans”. Amazing! Airbnb hosts work hard, and so while cash flow can be sporadic, we think it should register as part of your income when remortgaging. Using your Airbnb income sounds easy enough to do, with CNET stating that you just need to “include ‘Airbnb proof of income’ in [your] application”.

Airbnb explained that they’ve had to battle to get some lenders on board: “Financial institutions haven’t always understood home sharing and how it’s an economic lifeline for many families and individuals. That’s one of the reasons why many lenders didn’t recognize Airbnb income when people applied to refinance their home loan.”

This was also touched upon by Housing Wire. They expanded, saying “Many continue to question Airbnb, saying it could be disrupting the housing market. […] The prospect of being able to rent homes out as short-term rentals keeps homeowners from putting their home on the market.” They agree that this move is significant, as “under this new partnership, the housing industry would be working together with Airbnb to benefit homeowners looking to refinance their home.” We think that’s a big step in the right direction.

Airbnb also highlighted the benefits for hosts, claiming that “this could help unlock potential savings for hosts and help them reach their financial goals”. They themselves will be hoping for a jump in host sign ups, and the three lenders should see more applications for mortgage refinance. Everybody wins.

Airbnb’s co-founder and chief strategy officer, Nathan Blecharczyk, emphasised the importance of the short term letting company for families: “Today, some of the nation’s largest financial institutions understand that Airbnb is an economic empowerment tool that can generate important income for families, and they are working to recognize this.”

The initiative is also causing excitement among the lenders. Housing Wire caught up with Quicken Loans CEO, Jay Farner. He explained his company’s motivation for partnering with Airbnb: “Technology is at the heart of everything we do at Quicken Loans, so it is a natural fit for us to partner with one of Silicon Valley’s most innovative companies”, and added “Airbnb and Quicken Loans are firmly aligned to drive innovation in the real estate industry to dramatically improve and simplify client experience, as well as saving homeowners time and money.”

Better Mortgage CEO, Vishal Garg, shared that opinion. Speaking to Housing Wire, he commented that “We are proud to be working with Airbnb and Fannie Mae to make it easier for Airbnb hosts to reinvest in their most important economic asset, their home.”

We want in on the action

Giggers need UK lenders to be more agile and innovative

We’re very excited about this announcement. We know how hard gig economy workers of all types and industries work. This initiative makes remortgaging easier, quicker, and most of all cheaper for them.

Given the news of impending interest rate rises, this sort of helping hand when remortgaging could be extremely useful to UK giggers very soon! So really, there’s only one question – how long until we can do this in the UK?!
Picture credit: Patrick Perkins on Unsplash

Bank of England Maintains Interest Rates

The Bank of England has announced that it is keeping interest rates at 0.5%, but hinted at increasing the base rate soon. Read more

When Is The Best Time To Remortgage?

The main reason people remortgage is to make sure they are not paying more than they need to. When a mortgage deal comes to an end, many people find themselves falling onto their lender’s expensive standard variable rate (SVR). Read more

Mortgage Advisor – 9 Reasons To Get Independent Advice

Do you look at mortgage advisors and think “Why do I need one? Can’t I arrange a mortgage myself?Read more

What Is Our Mortgage Application Process?

GIGLY always aims to make your mortgage application process as easy and straightforward as possible. So to kick off 2018 – we’ve distilled the process down to ten simple steps in an attempt to make mortgages even easier. Let’s have a look at how the application process works. Read more

The Documents Needed For A Self-Employed Mortgage

Mortgages lenders are actively embracing people who work in the gig economy. Just look at the stats – in 2016, the number of mortgage loans taken out by self-employed workers increased by 11% whilst loans to employees grew by just 6%. Read more

How can I improve my credit score?

Before applying for any mortgage, you should always check your credit report carefully, to establish if there is any reason why your application could be refused. You can obtain a copy of your report from a credit rating agency – the major ones include Experian, Equifax and CallCredit.

If you don’t like what you see, it’s not a disaster. There are ways you can improve your credit score, giving you a better chance of having a mortgage application accepted. We’ve put together three high impact areas you should focus on if you want to improve your credit score.

1. Pay Your Bills On Time

Lenders don’t like to see late payments as it might suggest that you are unable to successfully manage your current finances and therefore aren’t able to cope with further debt in the form of a mortgage. If you can pay off any payments before you apply for a mortgage, then do that!

2. Close Unused Accounts

Make sure to close any unused accounts that could be charging you unnecessary fees. Lenders will view old accounts as credit which is still available to you, and this might affect your ability to get new deals. Checking your credit report will help you to identify any accounts you may have forgotten about.

3. Get On The Electoral Roll

Being on the electoral roll provides valuable proof of your address to lenders – it is evidence of where you live and how long you have done for. Remember, lenders want to be reassured that you can pay them back and a stable living environment does just that. You can register at www.aboutmyvote.co.uk

Why A Credit Score Is Important

Having a poor credit rating isn’t the end of the world and certainly doesn’t mean you can’t get a mortgage, it does, however, make things slightly more challenging but there are lenders who are prepared to help those who have been rejected elsewhere. (Contact us for more information)

Banks and building societies want to be reassured that you will be able to pay back the loan so often comb through applicant’s financial history very carefully. They are looking to see if you have defaulted on any previous payments and often their offer will be determined on the following factors:

  • Credit report
  • County Court judgements
  • Any bankruptcy proceedings

If any of these scenarios apply, the chances are you won’t be eligible for most mortgage deals, or you will have to pay a higher rate of interest – even if your financial problems occurred a long time ago.

Remember that certain simple oversights, such as not being registered on the electoral roll, or failing to close credit card accounts that you no longer use, can have a negative impact on your credit rating.

 

Photo by Clique Images on Unsplash

What Documents Do I Need For A Mortgage?

When applying for a mortgage it is a good idea to sort out all the paperwork you’re going to need ahead of time. We’re not going to lie – it’s a pretty boring task, but the quicker you get it over and done with, the quicker GIGLY can deliver your mortgage and you can move in to your dream home!

What you will need will depend on your specific circumstances and the lender you are going through. The GIGLY checklist is however, a good starting point from which to build on.

Identification

GIGLY carries out electronic identity checks on each applicant, but all mortgages require you to provide proof of identification and address. This is to prevent sneaky money laundering schemes. You have to show a current, valid original document – not a copy or expired version. Below are some examples of what counts as valid identification.

Photographic ID

  • A valid current passport
  • A valid photocard driving licence

Proof of Address

  • A utility (gas, electricity, water, etc) bill that is dated within the last 3 months. Note – lenders, do not accept mobile telephone bills
  • Your council tax bills for 2017/18
  • A bank statement dated within the last 3 months

Show Where Your Deposit Is Coming From

All lenders need to see where your deposit is coming from, whether it’s from your savings or a gift from someone else. Proof should be presented in the form of bank statements, lenders can be very fussy as to how these statements are presented so we recommend scanned copies that include your name and address.

You can find your bank statements by logging into your online banking and clicking ‘statements’ from the menu.

Documentation

Each mortgage is unique and will require specific pieces of evidence, so we have listed the necessary documents below dependent upon what type of work you do, and what mortgage you are looking for.

Contractor

  • A copy of your current contract
  • Three months worth of personal bank statements
  • Proof of Deposit (Bank statement showing the funds to use)

PAYE

  • Three months of payslips & your latest P60
  • Three months worth of personal bank statements
  • Proof of Deposit (Bank statement showing the funds to use)

Self Employed/Freelancer

  • SA302 & Tax Year Overviews for the last three years (Documents produced from HMRC which confirm the applicant’s taxable income for each tax year). The tax year ends 5th April each year so for mortgage applications we now need documents for 2015 – 2017
  • Three months worth of personal bank statements
  • Proof of Deposit (Bank statement showing the funds to use)

Zero Hours Contractor

  • You must have been in your current position for a minimum of twelve months and able to provide twelve months worth of payslips (or fifty two weekly payslips if you are paid weekly)
  • Three months worth of personal bank statements
  • Proof of Deposit (Bank statement showing the funds of use)

So there it is – the documents you’ll need to provide to get a mortgage. Time to start rummaging through the filing cabinet!

 

Photo by Florian Klauer on Unsplash