“It could be two years getting the mortgage ready, which is basically making sure that they have everything in place. So when they apply for that mortgage, they’re pretty much guaranteed to at least get their application through.” – Manda Walker
Sarah Tucker’s introduction to our guest,Manda Walker…
Manda is a cherished member of The Mortgage Mum team and is more than just a mortgage broker. At The Mortgage Mum we are women who have many facets to our personalities and many things that we bring to the table. And Manda is also known as the mortgage coach in her special program. She gets clients’ mortgages ready, and she is on hand to work with them until the day that they are ready to start looking at a mortgage.
In this episode we talk about this in more detail, giving you lots of great tips to get yourself ready for a mortgage. And if you are a first time buyer wondering if you can get on the property market, then this episode is absolutely going to help you make those first steps.
Listen in above for the full episode or read below for a key summary of our conversation…
How did you get into this world of property and mortgages and coaches? What’s your background?
When I left university I was living out and then when I moved back in with my parents, after about six weeks, I realised I wanted my independence. So I basically saved up for a deposit. Luckily back then deposits were a lot less, I was a trainee accountant at the time, so I was earning good money and able to save in a short space of time.
I wanted my independence as soon as possible so I bought my first place close to London but after 3 years realised it wasn’t the place for me. I’d heard about Let-to-Buy so I rented that property out and used the equity to buy my next property. And then I did that again a few years later. I became a chartered accountant but in a conversation with a friend one day about mortgages I found I was more excited about mortgages than doing her tax return!
I did an advanced course in two weeks and passed my Cemap 3.5 weeks later. I believe in the power of three, and three different people told me to “go to Sarah Tucker aka The Mortgage Mum” and I’ve never looked back. I just love what I do.
And you’re studying to be a financial coach as well right now? That talks about money, mindset, relationship with money. Where does that come from?
My dad was Irish and my Mum is Jamaican. They both came to England and didn’t have a lot of money, so they really did have to make every penny count. I supposed they’ve given me that discipline from a young age. I had chores around the house and chores meant earning money. That also helped me when I was at university – cooking, ironging, cleaning etc.
At university I had so much freedom and I had the time of my life. I really think that was where I myself and then when I went back home, all my freedom was taken away. I had a few brothers and being the baby of the family I ended up craving my independence.
You’ve built a property portfolio, including a Let-to-Buy. What does Let-to-Buy mean?
You let a property out in order to purchase the next property. The traditional way is when you buy a flat and you are ready to upsize to a big property, you’d sell that flat. Once you paid back the mortgage, you’d use that money to invest in your next property with a let to buy.
You can look at what that existing property is worth then look at what the mortgage is – and that difference is your equity which becomes your deposit and then the rest of it, you pay the mortgage yourself because that will be your main residential property.
It’s a different way round where you can experience living in the property that you’re buying and gradually increase your portfolio as you move house, plus you get to move, which is quite nice.
You also have a mortgage coaching business on the side called The Mortgage Coach.
I do get first time buyers who approach me, but they aren’t anywhere near mortgage ready. So they haven’t got their deposit. They haven’t sorted out their credit. And they really do need a lot of help. So I had a particular client who I met straight out of university and she had this great idea. She was going up to Liverpool to do her Masters and she’d worked out that if she bought a property up there it’s a lot less than in London and what the mortgage would be, would be a lot less than what she’s paying for rent.
She wanted to buy a property up there, but unfortunately she had very low credit – she needed for me to work with her. So I worked with her for about nine months before we were able to get her mortgage. I then realised that there really are people that you can help more.
Don’t get me wrong. I love helping people get the keys to their first home. It just fills me with joy. Sometimes I get more excited than they do, but I also love the journey. And I think I love being able to help someone, sometimes I help them for 12 months, it could be two years getting the mortgage ready, which is basically making sure that they have everything in place when they apply for that mortgage.
They’re pretty much guaranteed to at least get their application through. Obviously every lender is different, every different criteria, but at the end of the day, if you can get all your ducks in a row that puts you in a much better position when you’re applying for that mortgage.
A lot of people want independence, but they’re not sure of how to get there.
So that’s what I do. So there’s two things I do. The first thing is called, Get Mortgage Ready and it’s a bootcamp and I run this on Facebook it’s every month. It’s three days out of the month that includes tasks, videos and lives. Then the other side is I have a membership that consists of a catalogue of videos and coaching that you can look at on all the different topics around mortgages and money mindset. I come in live to coach you throughout the month and it gets you mortgage ready too.
The coaching has actually inspired one of my clients from coaching who was a teacher and he set up a property club in a school to educate students about earning potential etc. I think they need a really good foundation. It’s all very well getting a credit card for instance, to build up your credit score, but then you’ve got to understand what the ramifications of that means.
Schools teach you finance and maths, but they don’t teach you about how to manage money which is really important, so his property club at his school is really inspiring. There’s so much more than mortgages, there’s budgeting and managing finances too.
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A lot of our first time buyers, I wouldn’t say are mortgage ready when they come to us. So how do you determine what lane they’re in? Is it based on how much deposit they’ve already saved or the time scales?
It’s not always about deposit. It’s about where they are on their journey. A lot of people could possibly have a big deposit or be relying on their parents for a deposit, but if they don’t have the understanding, then that’s also very important. Some people are ready, but it’s a case of having the conversation and really finding out where are they on their credit path, where are they on their deposit path, because there are a lot of different things that combine to making the best mortgage application. So they’ve just got to be ready for that.
What 3 small things that they can do today or this week or in the next fortnight that will help them to get mortgage ready?
My top three tips are first, I think credit is really, really important. The thing that I always recommend is Check My File. It is really important to have an all round understanding of your credit. Especially if you buy a new car for example. By keeping an eye on your credit report, you will see how that affects your credit score.
The second thing I would say is you’ve just got to know what you want. So it’s really important to know what your salary is and what sort of property you are looking to purchase – so what you can afford.
And then the last thing is what you can borrow and all of that is related to how much deposit you’ve got.
Have you had any experiences yourself as a broker or as a coach with people’s credit scores that have been really surprising?
I did have unfortunately when a guy was at university, he thought he was just being a good guy, but all the utilities were in his name. He ended up having a major default because when he moved out the utilities were not transferred and ended up staying with him but not getting paid. It ruined his credit file.
I remember when I first said to my friends that I was going to buy property – but back then they chose to stay home and buy cars and are now only realising that buying a property is a great investment. You just need to investigate properly and go with someone that does know what they’re talking about as opposed to someone that has no financial education at all.
If you could go back in time, is there anything you’d do differently knowing everything that you know about mortgages and property now?
I think the only thing I would do is the second property I bought, the second flat I bought, the day after I bought it, the landlord – the freeholder – knocked on my door and asked me if I wanted to buy the freehold. I said no but it did cost me a lot of money in the long run when he sold it to someone else. I tried to extend my lease and they just charged me way above the market rate and I could have bought it for so much less. So that’s my biggest regret.
With flats, you really do need to understand leaseholds and freeholds, and I didn’t have a clue back then.
There seems to be a massive take of people extending their leases at the moment. When you buy a flat it’s typically leaseholds and it’s pretty difficult mortgage wise. How long should people aim for that lease to be before they need to be concerned about the cost of potentially extending it?
I think once it’s going lower than a hundred years, I think you should start looking. You should be aware of leasehold properties and also be aware of service charges as well, because with the leasehold property, you are going to have a service charge. So it is important to understand them both.
The first property I bought was in a block and I did get done with the service charge. So then when I bought my next property, that was a Masonette and the good thing about Masonette I, I was able to buy the top half and I actually converted it from a one bed to a three bed because I went into the loft. If you can find property where there is potential, that’s a tip I would give. I always look for the worst property on a really nice street and do it up.
For first time buyers here, they can join your bootcamp, find you on social media, get their credit report, work out their deposit and affordability and more.
It really is good to have someone that knows what they’re doing. If you can have someone to bounce ideas off, someone you can talk to. At the end of the day you are just learning. Buying your first property is amazing. And the sooner you do it, the better. But I think at the other end of the spectrum is to make sure that you’ve got someone who has got your back, who is going to be there for you and doesn’t just treat you like a number. Do your research, but have someone that you can talk to who can really, really help you and wants to help you.
Find Manda Walker on Linkedin and follow her Broker and Coach businesses on instagram here:
https://www.instagram.com/manda_themortgagemum/
https://www.instagram.com/mortgagecoachonline/
Thank you to Manda Walker for joining Sarah Tucker on The Mortgage Mum Podcast. Listen to The Mortgage Mum Podcast on all major podcast directories including Apple and Spotify. You can also catch up on previous episodes on our website and on The Mortgage Mum YouTube channel.
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