Property

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Is your poor credit rating looming over your every financial decision? You are not alone! In the current financial climate it is becoming increasingly more common for new and existing home owners and renters alike to be turned away by home and contents insurance providers as a result of their poor credit rating. But this isn’t the end of the line for you, there are still options available…

Why has my credit score affected my insurance premium?

Insurance companies follow the same strategy as all other money lenders in that they want to be sure that you can afford the monthly repayments for your insurance premium. Unfortunately your poor credit score doesn’t paint the best picture for your future ability to keep up with regular payments.

What can I do if my insurance is turned down?

It’s never too late to improve your credit score; from jumping on the electoral register to applying for a credit card – there are plenty of things you can do to rebuild your rating. However, your score is not going to go from red to green over night so you are going to need to find some cover in the meantime.

In this instance, the most important thing to look for in a home insurance provider is that your premiums are not heavily biased by your low credit score.

Doing your research into companies that will accept you based on your rating is going to take some time – so we’ve done the leg work for you!

CoverBuilder are a specialist home insurance provider who specialise in protecting individuals who are struggling to get insured due to their individual financial circumstances. In fact, they are able to offer payment options to 95% of cases with poor credit.

Will I have to jump through hoops to find out if they will accept me?

If you have been turned down by a different provider, you might think that a company who is willing to take you onboard based on your history will expect a lot from you and will leave you lingering while they calculate the risks.

We’ve found that CoverBuilder only require the basics to be able to offer you a quote, so once you’ve completed your online application form they are able to provide you with an instant decision. They also provide a friendly online instant chat service for support, so you don’t need to worry about discussing your financial woes over the phone with an unsympathetic call centre robot.

Don’t forget, it’s really important that you’re upfront and honest with your insurance provider and declare any previous financial difficulties with them. If you later need to claim and they find you’ve been dishonest you’ll be at risk of not being eligible for a payout when you might need it the most.

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owning your home

If you are currently renting your home, you may have thought about how your financial situation would look if you were to get out a mortgage and buy a property for yourself…

There are a number of interesting debates on this topic, here we will delve into some of the key reasons for taking out a mortgage to buy your own home.

Of course every rose has it’s thorn and it’s important to analyse mortgage rates and inflation against your own situation before making a commitment.

1. More Affordable Monthly Payments

By getting a mortgage on your home, you take away the landlord’s cut of your monthly payments. So depending on the term of your mortgage, you’ll often find it works out more affordable than paying rent on a similar property and thus decreases your household bills.

2. You Gain An Asset

What’s more, by taking out a mortgage on your home, you’ll find yourself with a financial asset that you haven’t had before. The truth is, we all need somewhere to live and that means committing our finances towards accommodation, whether we rent or have bought our home, with this in mind it makes sense that we can work towards owning a substantial financial asset while we’re at it.

3. Freedom To Make a House A Home

Owning rather than renting a home, can give you more freedom in how you make your property into a home. When renting a property, there is often structures around what you as a tenant can do to the property, even down to the colour of paint on the walls!

You will need the permission of the landlord to make changes which understandably they will be reluctant to approve. Take out a mortgage on your home, and you’ll have a great deal more autonomy over what you can do, from the wallpaper to the structure, giving you the opportunity to make it work for you.

4. Make Your Property Work for You

Though it’s not always the case, owning your home can give you the opportunity to make money in a way renting a property does not. It might be you could take in lodgers through AirBnb or even though longer term lets – you also have the potential to rent out your property in the future.

Just remember, if you are looking to buy a property through a shared ownership scheme such as the help-to-buy or first-time buyers scheme, there are often restrictions on subletting your property or making structural changes to the property. If this is something you are interested in, make sure you understand the small print before you sign up, talk to an experienced mortgage adviser to find the right mortgage for you and to guide you through the process.

So there you have our 4 top reasons why you should get a mortgage on your home, from reducing your household bills when compared to renting, to providing you with a substantial financial asset that you could potentially make work for you.

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selling parents house

Coming into ownership of a property through the loss of a family member can be difficult to deal with – with all the complications surrounding the inheritance of a home, it can be confusing to enter the world of probate and tax involved in such a sale.

There are a number of factors to consider if you have inherited, or look to inherit, a home. Are you the sole inheritor, and will own the entire property by yourself – or have you inherited joint ownership? You also need to consider your intentions for the home.

Whether you intend on renting, keeping or selling the property – your credit rating is an important factor to consider at every stage of inheriting a home.

Joint inheritance

If you have sole ownership of an inherited property, the process of deciding your next actions can be fairly simple. However, in cases where ownership has been split, choices will have to be made regarding overall decisions on what is to be done with the property.

There is the option of buying out other inheritors – however, this will likely involve putting up large amounts of upfront cash. This will more often than not mean applying for a loan, which is heavily reliant on a strong credit rating.

Intentions for the property

There are various services available depending on your intentions for a property – whether this be living in the home (rules may differ if you live abroad or own a second home), renting out the home (in which case tax may need to be paid on the rental profit, as pointed out on the UK Government’s website), or selling the property.

A high credit rating is important if you are intending to sell an inherited property. A credit rating score measures how likely you are deemed to pay back a debt you owe, and thus affects any future borrowing from a bank or building society. Any creditors that are owed money would likely have priority on any money made from the sale of such a house.

Issues of leftover debt need to be addressed. Any mortgage that remains unpaid from the previous owners of the property will also need to be taken into consideration. Unfortunately a poor credit rating means that you may not be able to take on a mortgage from a previous property and could risk losing the home.

Other concerns

If you do choose to sell and have the necessary requirements, you will also need to consider whether you are required to pay any Capital Gains tax on any profit you may make. If this has not already been addressed in the deceased person’s will or estate documents, you will need to consider how to get a probate property valuation yourself.

Beyond this, it may be sensible to seek further expert advice through a company such as Probate Purchasers, a company which guarantees an efficient sale of probate properties. The firm is a founding member of the National Association of Property Buyers, as Probate Purchasers explains on its website.

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