Track Record Mortgage
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What is a Track Record mortgage?
With only very limited options to borrow with less than 5% deposit or no deposit at all, or without help from friends and family, Track Record mortgages could be a solution.
Skipton Building Society is offering a 100% mortgage based on your track record of paying rent and bills. You still have to pass eligibility and affordability checks.
Who qualifies for a Track Record mortgage?
You might qualify if you:
- Haven’t owned a property in the UK for the last three years
- Are aged 21 or over
- Want to borrow up to £600,000
- Have proof that you’ve paid rent and all household bills for at least twelve months in a row, within the last 18 months
- Don’t intend to buy a property in Northern Ireland
If you’re applying on your own, you must have paid for rent and household bills by yourself for twelve months in a row in the last 18 months.
For joint applicants, one of you must have made these payments either together or on your own.
If you’ve been renting different places but want to apply together, each of you must prove you’ve covered your own rent and bills. Both of your rent payments will be used to decide how much you can borrow, which can let you borrow more.
Can I put a deposit down on a Track Record mortgage if I have one?
You can put a small deposit down if you have one, but it needs to be less than 5% of the purchase price. If you have a deposit worth 5% or more, another product or scheme might be more appropriate for you.
I don’t own my own home but have a buy to let – can I get a Track Record mortgage?
You can’t use Track Record if you will own another property on completion, i.e. a buy to let.
Can I use Track Record with another scheme?
Most schemes can’t be used alongside a Track Record mortgage. This is because Track Record is a special type of mortgage in itself.
The only scheme that can be used is Shared Ownership.
Why The Mortgage Store Chorley?
Exclusive rates you won’t get directly from lenders
A dedicated point of contact from initial enquiry right through to completion and beyond
Appointments seven days a week, to best suit your schedule
Ongoing rate monitoring until completion as standard
Unsure if you can get a mortgage?
Contact us now for a no-obligation chat.
I’m a council tenant – can I use Track Record?
Yes, but if you get any housing benefit, you can’t use it for affordability purposes.
For example, if you pay £500 a month in rent but get £150 a month housing benefit, you could only use £350 in the Track Record calculator.
Bear in mind that you can’t use Track Record alongside Right to Buy or Right to Acquire.
How much can I borrow?
Skipton will assess both the rent you currently pay, and your income and expenses, to reach a figure.
What documents do I need to provide?
The standard documents needed are proof of ID and address, income verification, and bank statements. If you have a small deposit, proof of funds is necessary too.
You’ll also have to provide proof that you’ve paid rent and household bills for twelve months. This could be through bank statements, or monthly statements from your landlord as well as copies of your bills.
Is a Track Record mortgage the same as a tracker mortgage?
No.
A tracker mortgage is one with a variable interest rate. That means the rate can go up or down at any time. It is usually linked to the Bank of England base rate.
A Track Record mortgage is a 100% mortgage based on your record of paying rent and bills, meaning you could buy a house without a deposit. The rate is likely to be fixed for an initial period.
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What are the risks of a Track Record mortgage?
There is a risk of being in negative equity; that’s when you owe the bank more than the house is worth. This can happen if house prices drop, especially if it occurs shortly after you move in, when you haven’t had sufficient time to repay much of the mortgage.
If you were in negative equity, you wouldn’t be able to remortgage to another lender. You would also be out of pocket if you sold as you would have to find additional funds to pay back the full amount you owe the bank.
Can I move to another lender in the future?
There are no restrictions on remortgaging.
As long as you have sufficient equity, can pass the credit check, and pass the affordability checks based on income and expenditure, you can move to another lender in the future.
Pros and cons of a Track Record mortgage
Pros
- No deposit required!
- No restrictions on future resale
- No additional up-front costs
Cons
- Only one lender currently offering this product, so it may be withdrawn at short notice
- Risk of being ‘trapped’ in negative equity
- If your current rent is low, you won’t be able to borrow very much
How can The Mortgage Store Chorley help with Track Record mortgages?
Ready to take the next step towards owning your own home? The Mortgage Store Chorley specialises in Track Record mortgages, making the process of securing a mortgage simple and straightforward for you.
We understand the ins and outs of these mortgages and will work closely with you to determine the amount you can borrow based on your rental history and financial situation.
Say goodbye to uncertainty about getting a mortgage – let us be your trusted guide on the path to homeownership. Contact us today to begin your journey towards owning your own home!
YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE
