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How to improve your chances of getting a mortgage amid the pandemic

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Getting your finances in order to buy a home can be tough enough at the best of times. But in the midst of a pandemic, there can be an added layer of difficulty.

For example, what’s the best way of securing a good mortgage rate from a nervous lender if your income has taken a hit? And can you even still get a mortgage if you’ve been furloughed?

The answers to these questions are not always simple and so we have spoken to some mortgage experts for their advice. 

Their comments come amid a fast-moving backdrop that has seen a new lockdown applied across the country bumping into a stamp duty holiday that comes to an end in March, with no indication yet that it will be extended. 

The housing market has remained open this time around, although there is speculation that tighter curbs could be introduced – including the shutting of estate agents – if people flout the rules. 

We ask the experts: Can you get a mortgage if you've been furloughed amid the pandemic?

We ask the experts: Can you get a mortgage if you’ve been furloughed amid the pandemic?

Mark Harris, of mortgage broker SPF Private Clients, said: ‘If you are one of the many people moving for more space, inside or out, or to be nearer family, and are keen to take advantage of cheap mortgage rates and the stamp duty holiday, it can be frustrating if your income has taken a hit thanks to the pandemic.

‘With some lenders tightening criteria for groups such as the self-employed or those requiring high loan-to-values, getting a mortgage is not necessarily as straightforward as in the past.’ 

Here, we provide some top tips for helping you to wade through the mortgage application minefield amid the pandemic…

1. Know your credit score

It is more important than ever amid the coronavirus pandemic to know what your credit score is and how you can improve it.

This is because lenders are increasingly turning to credit scores to determine whether they will approve your mortgage application. 

So without a decent credit score, you may miss out on the best mortgage that you can get – or a mortgage altogether. 

Lenders have become nervous about lending to people who may not be able to repay their home loan at a time when unemployment is rising and workers are falling ill.

Gerard Boon, of mortgage brokers Boon Brokers, explained: ‘Lenders’ appetite for risk is becoming less and less as the pandemic worsens.

‘We have seen many cases in recent weeks that would otherwise fit a lender’s criteria under normal circumstances. But the mortgage has been declined merely due to the risk factor of the pandemic.’

He said: ‘Arguably what has been affected the most is credit scores. Especially in the higher loan-to-value brackets, lenders are limiting borrowing based on credit score rather than general affordability.’

For example, even though an applicant may be able to easily borrow up to 90 per cent of the value of a property based on their income and financial commitments, a lender may force this to be reduced to 85 per cent due to a borrower’s credit score.

Mr Boon added: ‘This is a key factor that is preventing most first-time buyers from proceeding with property purchases – as they can often only afford to put down a maximum deposit of 10 per cent of the purchase price.

‘Mortgage applicants with a low credit score will find it harder to get a mortgage offer as lenders may perceive it as an indication that they could miss a mortgage repayment.’

You can check your credit score on sites such as Experian, Equifax and ClearScore. If your credit score is low, it may be worthwhile trying to improve it and waiting a few months, making sure all your payments are made on time and information is up to date as a way of boosting it.

By contrast, some borrowers can be caught out by having too little debt. This can also lead to a low credit score due to a lack of credit history.

Mr Boon suggested that one way of establishing a higher credit score and proving that you can manage credit with no risk is by taking out a credit card to pay for basic expenses, such as grocery shopping and ensuring that the balance is cleared every month.

You can also improve your credit score by making sure you are registered on the electoral roll.

2. Avoid too much debt

Some lenders may decline your mortgage application even if you make all your credit payments on time as you may have a large amount of outstanding debt.

Recent credit applications may also count against you as a red flag and experts recommend not applying for credit for at least six months leading up to your mortgage application to stand the best change of having it approved.

3. Minimise your outgoings

Lenders will review your income to help establish whether you can afford a mortgage.

Historically, lenders would have a calculation – such as four times your salary – to calculate whether you could afford the loan.

But more factors are now taken into account based on affordability of payments, including where you spend your money.

It means that paying careful attention to how you spend your money in the run-up to applying for a mortgage, and minimising your outgoings will work in your favour.

For example, if you have a personal loan, you may be better waiting until it is paid off.

Other financial commitments that are important to minimise in the run-up to your mortgage application include credit cards and hire purchase loans.

4. Maximise your deposit

Some mortgages that only require a small deposit have been removed from the market amid the pandemic as lenders become increasingly adverse to risk.

That said, it has always broadly been the case that the bigger the deposit you have, the better interest rate you will get on your mortgage.

As such, if you’re close to saving a 15 per cent deposit, you may want to wait until you have the full amount as it will give you access to better rates. These rates mean you will pay a lower mortgage payment every month.

5. Challenges for the self-employed

People who are self-employed will generally find it more difficult to get a mortgage.

Lenders tend to require the last two years of tax calculation and tax year overview documents for those who are self-employed.

Rather than take recent income into account, most lenders will average the self-employed income figures declared on these tax documents.

Amid the pandemic, some lenders are also applying further tighter lending criteria for those who are self-employed. These include requiring larger deposits of up to 40 per cent of the value of the property.

Ray Boulger, of mortgage brokers John Charcol, explained: ‘There is currently an even wider variation than normal between lenders’ criteria for new mortgage applicants, particularly the self employed.

‘For example, Santander announced that from January 9, its maximum loan-to-value for self-employed borrowers is reduced to 60 per cent.’

6. Getting a mortgage if you’ve been furloughed

Lenders are also looking closely at the incomes of those who have been furloughed.

They want to see evidence that these borrowers will return to work at a set date in the future at the same salary.

Mr Harris confirmed that those lenders who will consider applicants on furlough – and where the applicant is also in receipt of an employer top-up to their salary – will require evidence and confirmation of an end date or return, and income top-up, from their employer.

He added: ‘Some lenders will require those who have returned to work after furlough to provide a payslip showing one full month’s proof of income, rather than a letter from the employer as evidence of return to work.’

Mr Harris suggested that if you are coming up to remortgage, it may be better to stay with your existing lender rather than try to remortgage away.

He said: ‘If you have been furloughed but are keen to move, it may be worth considering putting that move on hold until you return to work at your normal salary, if you can, and can access a much wider range of lenders and products again.

‘While it will be annoying to miss out on the stamp duty holiday, there are market commentators who believe house prices will dip anyway later in the year so it may not be a disaster returning to the fray at a later opportunity. You may also feel better prepared to take on a bigger mortgage at that time when your job and income is more guaranteed.’

Meanwhile, Mr Boulger went on to explain that lenders are generally not rejecting employed applicants who work in badly affected sectors, but an increasing number are ignoring furlough income in their affordability calculation – which in many cases has the same effect.

Lenders are not required to apply the onerous affordability test imposed by the Bank of England if the mortgage selected is fixed for at least five years 

Ray Boulger, John Charcol 

He said: ‘Borrowers in this position coming to the end of their deal who find they can’t remortgage will in most cases be able to obtain a new deal from their existing lender, thus avoiding reverting to their lender’s more expensive standard variable rate.’

‘Some lenders are asking borrowers shortly before completion to confirm that there has been no material change to the information provided on the application form. If the borrower confirms a change, such as being placed on furlough, there is a serious risk of the mortgage offer being withdrawn.

‘For many joint applications an acceptable way to address this problem is available because lenders are not required to apply the onerous affordability test imposed by the Bank of England if the mortgage selected is fixed for at least five years.

‘Providing the borrower has selected a fixed rate for at least five years the lender could base its affordability test on the mortgage pay rate rather than the much higher stressed rate and it seems reasonable for the lender to assume that after five years we will no longer have coronavirus imposed restrictions on economic activity.’

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Foley to bring school reopening plan to Cabinet on Tuesday

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Minister for Education Norma Foley says she has every confidence schools will reopen fully from late August and early September.

Ms Foley said there was ongoing engagement between her department and public health officials on the matter but all schools were set to reopen.

Strong mitigation measures would be in place in schools to ensure that they would continue to be controlled environments, she told RTÉ radio’s Today with Claire Byrne show on Monday.

Covid-19 infection rates among children were at their highest when children were not at school and public health experts had pointed out “on a consistent basis to schools being a very significantly controlled environment”.

The safe operation of the Leaving Certificate exams and enhanced summer camps indicated that the safe operation of education could be maintained, she said.

A plan would be put in place to allow schools to “draw down” CO2 monitors and the Minister said she was confident there would be enough monitors for all schools by the start of the new school year.

In relation to Covid-19 vaccines for children, Ms Foley said the “expertise” lay with the National Immunisation Advisory Committee (NIAC) from which her department would take guidance.

“I have received confirmation that the 16 to 18-year-old cohort should be in a position for online registration in the coming days, and I have been advised that the 15-year-olds cohort are still being considered by NIAC and there has been no definitive timeline given,” she added.

Ms Foley will bring a plan to Cabinet on Tuesday outlining enhanced public information campaigns, the outcome of antigen testing pilots, and the purchase of C02 monitors to assist in ventilating classrooms.

Capacity limits on school transport services will also remain in place.

Government sources were adamant on Sunday that second-level education would resume in the autumn, despite concerns among public-health officials that the wave could grow following the reopening of indoor dining today, before peaking in September.

“Schools will reopen,” a senior Coalition source said.

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Over 40 complaints made about ‘unsuitable’ books on English curriculum

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Some books being studied by Junior Cert and Leaving Cert English students feature “disturbing and sick content” and material that is “clearly unsuitable for minors”, complainants have told the Department of Education.

The department has received more than 40 complaints on the issue in recent months, with one email to Minister Norma Foley describing The Handmaid’s Tale by Margaret Atwood as “nothing but sadistic, upsetting and of no moral learning or value to students”.

The acclaimed dystopian novel is based in a patriarchal totalitarian state where women, or handmaids, are forced to produce children for commanders.

One “concerned parent” said they were “perturbed” that their teenager was studying the novel Room by Irish author Emma Donoghue.

‘Questionable’

They said many of the topics in the book were “questionable” and that greater consideration should have been given before the book was “forced upon sensitive people in this day and age”. The Booker-shortlisted story is told from the perspective of a young boy held captive in a small room with his mother.

The emails, released to The Irish Times under the Freedom of Information Act, were from parents, one of whom said they were “appealing to and begging” the department to change the curriculum.

One parent expressed “shock and concern” about the prescribed reading lists, citing a perceived “lack of vigilance regarding the age appropriateness” of some books. “The material is offensive, abhorrent and clearly unsuitable for minors,” they said.

The curriculum could “only be described as the sexualisation and desensitising of our children… there needs to be an investigation into this whole sordid affair”, another complaint said.

‘Enslaving’

One person said the book list was “enslaving” students to “abominable ungodly content”, while another sarcastically suggested there was “nothing to stop” Fifty Shades of Grey, the bestselling explicit erotic romance novel, being added.

Some emails were directed towards Ms Foley personally, and called for her to be fired and “held directly responsible”. The department’s response stated that the curriculum at all levels was considered to be for all learners “regardless of race, religion, socioeconomic background, gender or orientation”.

It said it was important that each book was viewed “in its entirety rather than being reduced to particular sections which may be especially controversial”, and that the texts had “strong literary pedigrees” and featured on curricula internationally.

There were also several emails sent to the department in defence of the curriculum, predominantly from students.

The text-list working groups for each subject, convened by the National Council for Curriculum and Assessment, are comprised of teachers, third-level lecturers, staff from relevant support agencies and experts in children’s and young adult literature. The curriculum did not change this year though the Minister said it would be reviewed in the coming months.


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EDEN CONFIDENTIAL: A new £10m home sweet home in the Cotswolds for Nick Candy and Holly Valance 

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You might have thought having a Chelsea pad worth more than £75 million would be enough for most property tycoons, but not for Nick Candy.

I can disclose that Candy and his pop star wife, Holly Valance, have splashed out well over £10 million on a Grade II‑listed mansion in Oxfordshire.

They will be a short drive from trendy private members’ club Soho Farmhouse, where Prince Harry courted Meghan.

That's sweet: Nick Candy and his pop star wife, Holly Valance, have splashed out well over £10 million on a Grade II‑listed mansion in Oxfordshire (pictured)

That’s sweet: Nick Candy and his pop star wife, Holly Valance, have splashed out well over £10 million on a Grade II‑listed mansion in Oxfordshire (pictured)

Holly Valance and Nick Candy attend Lisa Tchenguiz's 50th birthday party at the Troxy in 2015

Holly Valance and Nick Candy attend Lisa Tchenguiz’s 50th birthday party at the Troxy in 2015

The seven-bedroom property has a pool, stables, tennis and squash courts and its own chapel

The seven-bedroom property has a pool, stables, tennis and squash courts and its own chapel

While it is unknown how much the couple paid, records show it was bought for £8m in 2012

While it is unknown how much the couple paid, records show it was bought for £8m in 2012

The house is a short drive from trendy private members' club Soho Farmhouse

The house is a short drive from trendy private members’ club Soho Farmhouse

Candy and his pop star wife, Holly Valance, have splashed out well over £10 million on the property

Candy and his pop star wife, Holly Valance, have splashed out well over £10 million on the property

The seven-bedroom property has a pool, stables, tennis and squash courts

The seven-bedroom property has a pool, stables, tennis and squash courts

Candy, 48, declines to say how much they paid, but the house was bought by the previous owners for £8 million in 2012

Candy, 48, declines to say how much they paid, but the house was bought by the previous owners for £8 million in 2012

Prices have rocketed in the area, where locals include Kate Moss and JCB tycoon Lord Bamford and his wife Carole

Prices have rocketed in the area, where locals include Kate Moss and JCB tycoon Lord Bamford and his wife Carole

Candy, who has two daughters with his wife, adds: 'We're very immersed in our quiet country life at weekends'

Candy, who has two daughters with his wife, adds: ‘We’re very immersed in our quiet country life at weekends’

‘We have been looking for years to get something in the Cotswolds for the family, and finally, a year ago, we found a gorgeous family home in a wonderful village,’ Candy tells me.

The seven-bedroom property has a pool, stables, tennis and squash courts and its own chapel.

Candy, 48, declines to say how much they paid, but the house was bought by the previous owners for £8 million in 2012.

Since then, prices have rocketed in the area, where locals include Kate Moss and JCB tycoon Lord Bamford and his wife Carole, who started the Daylesford organic empire.

Candy, who has two daughters with his wife, adds: ‘We’re very immersed in our quiet country life at weekends and adore the friendly and welcoming village.’

Candy's luxury two-storey penthouse in Hyde Park has gone on sale for £175million

Candy’s luxury two-storey penthouse in Hyde Park has gone on sale for £175million

The stunning apartment is split over two levels, boasts five bedrooms, a 21m swimming pool, and measures around 18,000 sq ft - the equivalent of almost 18 average homes in England.

The stunning apartment is split over two levels, boasts five bedrooms, a 21m swimming pool, and measures around 18,000 sq ft – the equivalent of almost 18 average homes in England. 

Prolific author Alexander McCall Smith, creator of The No. 1 Ladies’ Detective Agency has been promised great things – but only after his death.

He says: ‘I was on tour in the United States and this woman came up to me with a book for signature, and she looked at me and said: ‘You know something, you’re going to be much more successful posthumously.’ ‘

The writer, 72, who has written 21 novels in the series, says. ‘She wasn’t being rude, but it was rather an odd thing to say to somebody.’

How guitar guru Beck gave Depp a silver lining 

Pictured: Johnny Depp is planning his comeback

Pictured: Johnny Depp is planning his comeback

With his acrimonious divorce from actress Amber Heard, and their bitter court room showdown in London last summer, Hollywood star Johnny Depp suffered the biggest setback of his glittering career.

Now, however, I hear he’s quietly planning his comeback — right here in Britain.

The 58-year-old star of Fantastic Beasts and Charlie And The Chocolate Factory has been taken under the wing of British rock legend Jeff Beck.

The Hi Ho Silver Lining guitarist, 77, who’s so talented he had each of his fingers insured for £700,000 in 2010, has secretly been hosting Depp at his Riverhall country estate in Wadhurst, East Sussex, where they’ve been writing and recording together in Beck’s studio. Depp is an accomplished guitarist himself.

‘They’ve been collaborating on material for Jeff’s next album,’ reveals a source close to Depp. ‘It’s been great for Johnny to get back to his first true love, which is music.

‘Jeff has been a great friend to Johnny during a very difficult time, and being away from Hollywood has been exactly what Johnny needed.

‘He wants to take a step back from everything and focus on a comeback through music.’

Eight-time Grammy Award winner Jeff, who has been called ‘one of the most influential lead guitarists in rock’ by Rolling Stone magazine, recorded a cover of John Lennon’s Isolation with Depp last year, intended to help people cope with life in lockdown.

Johnny Depp of Hollywood Vampires performs on stage at Celebrity Theatre in 2018 in Arizona

Johnny Depp of Hollywood Vampires performs on stage at Celebrity Theatre in 2018 in Arizona

In 2019 they played together at the Crossroads Music Festival in Dallas, Texas, for Eric Clapton’s charity, then did a short tour of the U.S.

Depp has previously featured on songs by Oasis, Iggy Pop, and Aerosmith, as well as on records by his ex-girlfriend, singer Vanessa Paradis, with whom he has two children. In 2015, he formed the super group, Hollywood Vampires, with Alice Cooper and Joe Perry.

‘Johnny hopes to return to films eventually,’ adds the source, ‘but it’s music first.’

Boogie-woogie pianist Jools Holland is learning to sing lullabies. The Later . . . with Jools Holland host has become a grandfather at the age of 63.

‘I am very pleased that I now have a wonderful grandson, Gabriel,’ he says. His musician daughter, Mabel Ray, 30, is the proud mum.

‘We seem to have identical hair,’ he adds of the baby. ‘He is a delightful little fellow. All thanks to the fantastic staff at Homerton University Hospital for delivering him to us.’

Queen’s Windsor gong show for late Duke’s loyal page

The Queen is making sure Prince Philip’s most steadfast former aides feel rewarded.

I hear that she invited the Duke of Edinburgh’s loyal page, William Henderson, to Windsor Castle this week to collect his gong.

His appointment as a Lieutenant of the Royal Victorian Order was announced on what would have been Philip’s 100th birthday.

Henderson was among those who took part in the funeral procession, walking behind the coffin.

Known for his sarcastic quips when required to report on the love lives of the Royal Family, waggish news anchor Simon McCoy seems to be secretly obsessed with the Windsors.

‘If I were invisible, I would go into Highgrove and stand by the phone to listen to any conversation Prince Charles might have with Harry,’ admits McCoy, who recently moved from the BBC to its new rival channel, GB News.

‘I feel desperately sorry for Charles — I really do. Family difficulties are bad enough without one of you bleating about it to the Press all the time.’

Creating a buzz with Angelina the Queen Bee 

There’s a buzz about Angelina Jolie, but it’s nothing to do with her film career.

The actress brought a touch of Hollywood glamour to the new French Apidology Observatory, in Sainte-Baume, where she presented its first graduates with their diplomas.

Angelina Jolie with children Pax, Zahara and Shiloh seen shopping at trendy KITH's in Paris, France

Angelina Jolie with children Pax, Zahara and Shiloh seen shopping at trendy KITH's in Paris, France

Angelina Jolie (pictured shopping Paris) brought a touch of Hollywood glamour to the new French Apidology Observatory where she presented its first graduates with their diplomas

Jolie, 46, who’s recently been seen out with her British ex-husband Jonny Lee Miller, was there because she’s involved in the Women for Bees project, which aims to encourage women to become beekeepers.

Clearly, there’s only one Queen Bee.

Paymaster General Penny Mordaunt, who starred on TV diving show Splash, will be demonstrating her water skills at the local pool rather than heading off to the Med this summer.

‘I’ll be staying in my constituency and spending time at my local lido,’ the MP for Portsmouth North tells me at the Westminster launch party for her book, Greater: Britain After The Storm, which she’s co-written with Chris Lewis. ‘I’ve earned that — I went to great lengths to save it.’

The forecast is hotting up with Carol’s exotic secret 

This could liven up those dull BBC meteorological reports: weather presenter Carol Kirkwood has revealed a secret skill.

‘I can belly-dance,’ whispers the former Strictly contestant.

‘It is actually quite hard, but I learned to do it when I was a student travelling in Turkey and Greece.’

The Scottish hotelier’s daughter, 59, adds: I can’t claim to be very good at it — but I do at least have the belly for it these days.’

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