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What should army personnel consider when getting a mortgage?

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Army personnel may have to approach mortgage applications in a different way, especially if they want to secure a beneficial deal or save money on investment property purchases. We cover some of the key considerations and opportunities for army personnel seeking a mortgage below.

Your financial situation

The financial situation of a member of the Armed Forces might not be as straightforward as someone working an office job. Pay could be impacted by periods of deployment or absence, and this requires a lender that understands the situation.

A specialist army mortgage adviser can help serving members find mortgage lenders who understand the state of play and even consider bonus payments as part of your income for increased borrowing power. In comparison, a standard mortgage adviser might not be fully aware of Armed Forces workers’ income and benefits, and they might not have relationships with lenders who are most suitable and beneficial for army personnel.

Mortgage options and special Armed Forces schemes

Army personnel have access to a wide range of mortgage types and could choose from a fixed or variable interest rate. An army mortgage adviser can ensure all of the options are fully understood and the pros and cons of each of them. Specialist mortgage advisers in this niche can also make Armed Forces employees aware of special schemes available to them, such as the Forces Help to Buy (FHTB) Scheme.

The FHTB Scheme – made permanent in 2022 - allows members of the Armed Forces with at least one year’s service to access 50% of their gross salary (maximum £25,000) to help them buy or build a property. The money is provided interest-free and it won’t need to be paid for up to 10 years. This is especially beneficial for serving members looking to buy their first home without a 20% deposit.

Army personnel can save on investment property!

It’s sometimes possible for army personnel to purchase a buy-to-let investment property with a residential mortgage instead of a BTL mortgage, provided the buyer will be living on base and can therefore rent out the property.

The benefit of this is that the residential mortgage is likely to have better repayment terms, such as lower interest, compared to a BTL mortgage.

Purchasing investment properties is typically considered higher risk by lenders, and they therefore charge higher interest on BTL mortgages. Yet, army personnel could still use a residential mortgage to do this while living on base, saving them considerably on investment property interest payments.

Mortgage advice services for the Armed Forces

Contact Public Sector Mortgages for bespoke mortgage advice for members of the Armed Forces. We’ve already assisted serving members to get the mortgage they need from a lender that really understands. Our team can help army personnel overcome payslip issues and periods of absence. Call us today to get started! 

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