26 Lowther Street, Carlisle, CA3 8DA

Mortgage affordability in a post-COVID world

stansherlocstg on September 10, 2020

Residential Mortgage
  • Uncategorized

Mortgage affordability in a post-COVID world

Back in March, the Bank of England slashed interest rates to an all-time low of 0.1%, in a bid to alleviate the severe economic pressure caused by coronavirus. As the base rate cut fed through to mortgage rates and with the continuing pressure of a closed mortgage market, lenders responded by withdrawing mortgage offers, increasing rates and pulling products from the market.

Between March and May:

2,656 mortgage products were withdrawn, many of which were high loan-to-value (LTV) deals (i.e. those requiring a smaller deposit).
396 two-year fixed and 374 five-year fixed deals at 90% and 95% LTVs were pulled from the market

Lenders make a cautious return
As certain social distancing restrictions began to be lifted in May and the property market reopened for business, lenders began relaunching higher LTV deals and products aimed specifically at first-time buyers, such as Help to Buy loans.

With the property market still in the early stages of recovery, it’s worth being pro-active and following some of these tips to maximise your chances of mortgage approval:

Save as much as you can – while many people are experiencing financial difficulties during the pandemic, many of us are also spending a great deal less than usual. Getting your deposit as high as possible will increase your chances of mortgage success.
Clear your debt – when considering your application, lenders will look at any outstanding debt. Clearing as much debt as possible, as well as closing any unused accounts, will increase lenders’ confidence in your ability to repay your mortgage.
Understand your credit score – the better your credit rating, the higher the likelihood you’ll be accepted for the best mortgage deals. Understanding your credit rating and how to improve it is key to moving forward with a successful mortgage application.
Keep excellent records of self-employed earnings – providers can be more nervous about lending to self-employed people, so having excellent records of your earnings over the past two or three years (depending on the lender) can really improve your chances.

Consult the experts
We’re on hand to make sure you get a great deal for your circumstances, and one that gives you the highest chance of success. Whether you’re a first-time buyer or a second stepper, we’re here to guide you through this difficult period.

YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE.

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If you are nearing retirement and assessing options for your pension pot, don’t act in haste. Talk to us.

stansherlocstg on September 10, 2020

  • Uncategorized

If you are nearing retirement and assessing options for your pension pot, don’t act in haste. Talk to us.

Are you approaching retirement?

If you are nearing retirement, you may have been particularly worried about the impact of recent market volatility on your pension assets and perhaps you are reassessing your retirement plans. There are several things to consider if you are planning to retire, which will depend very much on your own circumstances.

Since pensions freedoms were introduced in 2015, there are many more options available to retirees. Sudden retirements used to be the norm. People would stop work completely one day and be fully retired the next, perhaps receiving a regular income from an annuity. It is now possible to take a more gradual journey into retirement – making use of this flexibility in how you draw funds could be sensible in times of uncertainty.

Consider your timescales
If your planned retirement is 5 to 10 years away, there is a reasonable time for your savings to recover from the recent market volatility, but you should still take action:

Review your retirement age.
Consider increasing your pension contributions.
Talk to us about your attitude to risk and appropriate fund switches.
If you have less than five years to retirement, your pension pot may not have been exposed to market volatility as much as you think. You may have benefited from a lifestyle option on your pension which is designed to ‘lock in’ investment growth as you approach retirement, by switching funds to less risky assets. This option is not suitable for everyone, particularly if you intend to keep your pension pot invested and use income drawdown to give you an income in retirement.

If you are retiring this year and your pension pot has taken a hit, you could consider delaying retirement until markets recover, but this may not be an option for everyone.

Advice is key
One of the biggest risks in uncertain times is to act in haste and make rash decisions.

Getting financial advice is crucial in making the right decision. We can help you consider all your options, including reviewing whether any other assets could be used to provide an income, so that your pension stays untouched.

The value of investments and any income from them can fall as well as rise and you may not get back the original amount invested.

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Talk to us, don’t act in haste. Stay protected!

stansherlocstg on September 2, 2020

  • Uncategorized

Talk to us, don’t act in haste. Stay protected!

The coronavirus outbreak has impacted everyone across the globe, leaving many individuals and families in a precarious financial position. The crisis has shown that financial hardship can strike when we least expect it, demonstrating the importance of protection cover.

As people’s anxiety about their financial future intensifies, it’s likely that many people will be considering how they can reduce their outgoings. Income protection or critical illness insurance may be top of the list to cancel if they can be perceived to be unnecessary expenses.

In reality, critical illness and income protection policies can protect your income or support your family, if you lose your jobs or become ill for an extended period of time, so should certainly not be on the list of expenditure to cut.

A financial lifeline
Never have we been so starkly reminded of the need for the safety net of protection cover. A recent YouGov survey about the pandemic revealed that nearly a third (32%) of Brits currently fear for their future. Cover such as life insurance, critical illness cover and income protection can help lessen the blow of unexpected events.

Don’t act in haste
 Covid-19 is resulting in financial difficulty for many and may lead people to consider cancelling their protection insurance direct debits. Please don’t act in haste, talk to us, we can offer support and guidance if for any reason, you are, or you think you will be, in financial difficulty.

It’s good to talk it through
Rest assured, what is certain is that we are here to help. If you have any questions about your protection policies or requirements, whether this be existing policies, or you are considering new ones – please get in touch, we have our finger on the pulse in this fast-changing environment and can assist you to navigate the challenges ahead.

As with all insurance policies, conditions and exclusions will apply

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The world is changing – so should your insurance!

stansherlocstg on September 1, 2020

  • Financial Planning, Home & Life Insurances, Mortgages

The world is changing – so should your insurance!

The world is changing rapidly in a way that nobody could ever have expected, meaning your personal and financial circumstances are likely to have changed. It is important to regularly review all aspects of your finances and that includes reviewing your protection insurance, to make sure your policy provides adequate cover for your changing needs.

Underinsured
If you don’t regularly review and update your policy, any pay-out you do receive from your claim may not be enough to cover you and your family’s needs if you were to die or if you are unable to work due to illness.

Say you took out a life insurance policy covering you for a certain amount. After several years, you may have children, resulting in a move to a larger house. If you take a larger mortgage, your monthly outgoings would increase, and you would have bigger bills to pay. Therefore, the lump sum paid out to your family upon your death would no longer be sufficient to sustain their lifestyle and might leave them facing financial hardship.

New policies offer better protection
Like any industry, the insurance industry has evolved over time. Modern policies can offer you better protection and more extensive cover.

When comparing a critical illness policy sold in 2007 with one sold in 2017, the more modern policy may have better claims wording, provision for part-payment and other advantages.

If you have simply been paying your premiums on the same policy for years, it is likely that, as well as facing the risk of being underinsured, you also won’t be benefiting from the kind of comprehensive cover offered by today’s policies.

Let us protect you
With so many different types of protection insurance on the market, it’s not surprising that many people just stick with the cover they have.

It may not be the best cover for them. We can assist you in finding the very best policies for your circumstances, so you have the peace of mind that you, and your family, will be protected should the worst happen.

Please note: Older policies may cover illnesses which modern policies do not. Premiums may be cheaper due to the age of the policy. Certain cover may be excluded on a new policy due to pre-existing conditions.

Always get professional advice when reviewing your insurance policies. As with all insurance policies, conditions and exclusions will apply

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Now is not the time to neglect your pension – keep your planning on track!

stansherlocstg on August 17, 2020

Retirement planning
  • Financial Planning

Now is not the time to neglect your pension – keep your planning on track!

The Coronavirus outbreak is having a widespread impact across all aspects of our financial life, with many people finding their income reduced. At times like this it can be challenging to stay focused. No matter what age you are, now is not the time to neglect your pension. Try your very best to keep your pension planning and contributions on track – don’t allow the pandemic to cast a cloud over your long-term plans.

It’s never too early to start saving into a pension…

You should start saving for retirement as soon as possible, as the sooner you begin, the longer your savings have to grow. Other financial challenges can make this difficult but investing regular amounts in a pension throughout your working life gives you the best chance of enjoying a prosperous retirement.

…but better late than never

Don’t think it’s too late to start saving for your retirement. The favourable tax treatment pensions enjoy and their potential for investment growth, means any contributions you make later in life can still make a huge difference to your standard of living in retirement.

Take control of your retirement

When you reach 55, it’s important to carefully consider what you can do with your pension pot. For instance, you could keep your savings invested, take a cash lump sum, draw a flexible income (drawdown), buy a fixed income (an annuity), or a combination of these. While this flexibility may enable you to retire earlier or semi-retire, it’s vital you take full control of your retirement options at this stage. This should include seeking advice to discuss the pros and cons of the different avenues available to you.

Know your numbers

You can contribute as much as you like into your pension, but there is a limit on the amount of tax relief you will receive each year. The Annual Allowance is currently £40,000, or 100% of your earnings, whichever is lower. You can, however, carry forward unused allowances from the past three years, provided you were a pension scheme member during those years.

For the 2020-21 tax year the Tapered Annual Allowance limits altered. The Threshold Adjusted Income limit is £200,000 and the Adjusted Income Limit is £240,000. If your income plus pension contributions exceeds the Adjusted Income Limit, your Annual Allowance is reduced by £1 of every £2 you are over the Adjusted Income Limit. A Lifetime Allowance also places a limit on the amount you can hold across all your pension funds without having to pay extra tax when you withdraw money. This limit is currently £1,073,100.

Get good advice

Retirement planning is never a case of ‘one size fits all’. It is vital you obtain sound financial advice tailored to your individual needs. We offer advice and help with all aspects of pensions and retirement planning, whether you’re just starting out and want help choosing the most appropriate pension products, or you’re approaching the stage of life when you need to utilise your pension pot and want to know the most efficient way to access your funds. We are here to help.

The value of investments and any income from them can fall as well as rise and you may not get back the original amount invested.

HM Revenue and Customs practice and the law relating to taxation are complex and subject to individual circumstances and changes which cannot be foreseen. 

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Mortgage Payment Holidays

stansherlocstg on August 17, 2020

Mortgage Calculator
  • Uncategorized

Mortgage Payment Holidays

The Chancellor’s announcement back in March, offering 3-month mortgage payment holidays for homeowners experiencing financial difficulties due to COVID-19, came as welcome news to many people. Mortgage lenders agreed with the Treasury that any customers who are in ‘difficulty’ will be eligible.

Initial uptake
Recent data has revealed over 1.2 million mortgage payment holidays have been offered to customers impacted by COVID-19. Around one in nine mortgages in the UK are now subject to a payment holiday. In the two weeks to 8 April, the number of mortgage payment holidays more than tripled, growing from 392,130 to 1,240,680, with an average of around 61,000 payment holidays granted each day.

1.2 MILLION MORTGAGE PAYMENT HOLIDAYS OFFERED
61,000 PAYMENT HOLIDAYS GRANTED EACH DAY.

How does it work?
Homeowners who are concerned about being able to pay their mortgage should contact their lender. If you progress to applying for a mortgage payment holiday, you will have to self-certify that your income has been affected – no documentation is required. If you’re a landlord, you will need to self-certify that your tenant’s income has been affected. With many lenders, you can make an online application, your lender should not charge a fee to process your application.

Credit agencies have agreed an emergency payment freeze due to the pandemic, to ensure current credit scores are protected for the duration of an agreed payment holiday.

Lots to consider
The key benefit of a payment holiday is that it provides short-term relief, alleviating some financial pressure. Faced with a temporary drop in income, it can be a reasonable option, depending on individual circumstances.

Taking a payment holiday will not reduce the capital you still owe, nor will interest stop accruing. That means it will cost more to clear your debt once payments resume, so your monthly payments will be higher as a result of taking the holiday.

Need to knows
Banks were under no obligation to have payment holiday processes in place prior to the outbreak. Now most will offer them, although not to everybody. Based on your original mortgage application your lender will know what your job and salary are, and may reject you if you are still earning.

You must not stop making mortgage payments without speaking to your lender. If you do this, you will go into arrears, creating a black mark on your credit file which could prevent you borrowing in the future.

Don’t rush in
If you are worried about making your mortgage payments, it is crucial that you speak to your lender. A payment holiday may not be suitable for everyone. Some brokers have reported that people have panicked and arranged a payment holiday too early. If, for example, your partner is still receiving an income and your usual outgoings are down, it makes sense to defer the payment holiday until a time when you might really need it.

YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE

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Protecting you and your family…

stansherlocstg on August 6, 2020

Family walking along the beach
  • Home & Life Insurances

Protecting you and your family…

Losing your partner at any stage in life can be devastating, but it may be particularly devastating when children are involved because of the financial pressures of raising a family. Ensuring your children and other dependants are provided for in case you die should be a top priority but less than a third of people in the UK have life insurance.

Keep it simple

Many products are available but a simple level-term policy, where a pre-decided lump sum is paid out should you die within a stated period, is among the simplest to arrange and is typically not very expensive. As a rule of thumb, life cover should provide ten times the main breadwinner’s income. The amount should cover any outstanding debts, including mortgage, regular outgoings, potential university fees and so on. The term should reflect the needs of your dependants; Children will probably need support until they leave education and a partner may need it until pensionable age.

Joint or single cover?

A joint policy will cover you and your partner, paying out on the first death within the term. Alternatively, you can have separate single-life policies; a little more expensive but potentially two payments. A young, fit individual should find life cover affordable. Be open about your lifestyle, especially if you have existing medical issues. Premiums rise with age, lifestyle factors, such as smoking and other factors that affect your life expectancy.

Keep under regular review

Reviewing your protection needs helps make sure you have the right cover in place for your financial circumstances, giving you the peace of mind that you’ve got things covered.

As with all insurance policies, conditions and exclusions will apply.

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“Practically perfect in every way”… We introduce you to Annette Hunter:

stansherlocstg on August 3, 2020

Annette Hunter
  • Team

“Practically perfect in every way”… We introduce you to Annette Hunter:

Name: 

Annette Hunter 

What do you do at Stan Sherlock Associates? 

I am a senior administrator within the mortgage and wealth departments. I have recently moved to the wealth department, but I still turn my hand to mortgages. I input and process cases, problem solve and see a case through to completion. 

What do you enjoy most about being a member of the business support team?

I really enjoy working closely with our fantastic advisers, being supportive and efficient to ensure cases go through as smoothly and as quickly as possible. I love being part of our clients’ journeys and helping them secure their financial needs and desires is truly rewarding. Having worked at SSA for almost 17 years, I have encountered a wide range of hiccups and problems that can occur when processing a case; using my skills and knowledge to solve these problems and help a case make progress is a part of my job I also enjoy.

What has surprised you the most about working in Financial Services?

How incredibly different every client’s circumstances are .There are no two cases that are alike and each one requires a slightly different approach, whether that be lenders/providers or products. I have also been surprised by the complexity of financial services and how it is an ever-changing environment. An expert eye really is required to help you achieve your specific needs.

Describe yourself in 3 words?

Organised, caring and loyal.

Would your family use the same three words?

Yes they would, although they consider my level of organisation and planning to be fussy!

If you had to be shipwrecked on a deserted island, but all your human needs—such as food and water—were taken care of, what two items would you want to have with you?

A Kindle, with plenty of books pre-downloaded to keep me occupied. I would also take a tent for shelter, whether that be protection from rain or sun – I am prone to burning easily! However, if we can class people as items, I would take some family/friends for company.

If you could choose any super power what would you choose and why?

A Mary Poppins style tidying up super-power.I would love to be able to click my fingers and all the boring household/DIY chores are magically done, leaving me with extra time to enjoy life with family and friends.

How can you help me?

My aim is to help you in any way I can to the best of my ability.Clients are at the centre of what we do at SSA, so it is very important to us all to give you the best experience possible. My wealth of knowledge and experience gained in this industry can help to process and progress your case efficiently and smoothly, making your journey stress, and hassle free.

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Is your Life Insurance in Trust?

stansherlocstg on July 27, 2020

Family walking along the beach
  • Financial Planning

Is your Life Insurance in Trust?

A life insurance policy in trust is a legal arrangement that keeps a life insurance pay out separate from the valuation of your estate (property, money and possessions) after you die. Here we take a look at some main points to consider when deciding whether to write your life insurance in trust.

The logistics

A trust is a legal entity that allows you to put aside assets for your chosen beneficiary or beneficiaries. A solicitor or insurance provider can arrange to place your policy in trust. You can nominate one or more trustees to manage the trust until the beneficiary is ready to inherit. The trustee(s), ideally a solicitor or close friend, is responsible for ensuring the money set aside goes to the correct people after you have passed away. Trust deeds are agreed and signed by all parties, setting out the terms of the trust.

Trusts can be inflexible

You can set up either an absolute or a discretionary trust, the main difference being flexibility. With an absolute trust, they are fixed, so making any changes is not permitted. With a discretionary arrangement you don’t need to specify beneficiaries at the outset, how much will be received and when it will be received. You can also add other trustees to discretionary trusts once it’s set up.

It can be risky to amend a trust – there have been instances when people have invalidated their life insurance, after making changes to the policy in trust.

Minimising Inheritance Tax (IHT)

One of the prime motivators to people putting life insurance in trust is to mitigate IHT. Normally, a life insurance pay-out is considered as part of your estate, which will be liable to IHT on anything exceeding the £325,000 threshold (taxed at 40%). When you write your life insurance in trust, you are in effect, ring-fencing the pay out, so it won’t be included in the value of your estate, therefore protecting it from IHT and leaving more for your loved ones.

Greater control, expedience and options

Writing your life insurance policy in trust gives you more control over the pay-out. This is very important if you aren’t married or in a civil partnership; otherwise, your intended recipient may miss out. Pay outs from a trust can be paid quickly because there is no need to wait for probate to come through. If you have existing life insurance policies, you can transfer these into trust, but you would need to take advice on this first.

Seek advice

There could be tax implications if you move a life insurance policy into trust, for example IHT may be charged if, within 7 years prior to dying, a policyholder changes the person who’s named as a beneficiary on a life policy held in trust. If you are unsure whether to write your life insurance in trust, talk to us. We can guide you through the pros and cons considering your circumstances.

As with all insurance policies, conditions and exclusions will apply.

HM Revenue and Customs practice and the law relating to taxation are complex and subject to individual circumstances and changes which cannot be foreseen. 

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Sandra Sproat takes the limelight in the next part of our series “Getting to know our Business Support Team”…

stansherlocstg on July 27, 2020

  • Team

Sandra Sproat takes the limelight in the next part of our series “Getting to know our Business Support Team”…

 Name:

Sandra Sproat

What do you do at Stan Sherlock Associates?

I’ve worked here for almost 22 years, so I have my finger in many pies! As office manager, I work closely with Bobby and Emma Sherlock and we all try to maintain a happy environment for the staff. My secondary role has been described as ‘office mum’ which is quite an honour!

What do you enjoy most about being a member of the business support team?

I enjoy seeing cases through from start to finish.I get a real buzz from problem solving and love to make the experience, for our clients, as smooth as possible. If we do encounter any hurdles during the process, I like to make sure they are sorted without troubling our clients, so the stress of life finances stays firmly with us and not with them.Our support team is amazing, and we all help each other out if one of us needs a hand.

What has surprised you the most about working in Financial Services?

The complexity of some of the products and procedures and the realisation that it needs an expert to guide clients through the journey; be that mortgages, investing, or having the right pension. Our advisers have a wealth of knowledge and really know their stuff so our clients can be confident that they are in the best hands.

Describe yourself in 3 words?

Caring – Clumsy – a worrier!

Would your family use the same three words?

Probably!

If you had to be shipwrecked on a deserted island, but all your human needs—such as food and water—were taken care of, what two items would you want to have with you?

A big box of photo albums – I love looking at old photos and enjoying the memories. A radio with a lifetime supply of batteries – I couldn’t live without music.

If you could choose any super power what would you choose and why?

I would love to be able to fly. Imagine the exhilaration, clean air and peace up there! No pollution or traffic jams.

How can you help me?

I will do my very best to help in any way I can. Our clients are what our business is built on so you are very important to us. We want to look after you and give you confidence in our ability to take care of all your financial needs. If an adviser is busy with another client or away from the office, I will do everything I can to assist and answer any queries you may have. My experience in the industry means that I can help to progress a case efficiently knowing the best way to tackle any problems that might crop up.

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The value of investments and any income from them can fall as well as rise and you may not get back the original amount invested.

YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE. Some buy to let mortgages are not regulated by the financial conduct authority. 

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