A festive special showcasing some of the best advice of 2024

A look back at what you need to know about mortgages and how to save as a first-time buyer. A Tell Us about the most joy you’ve ever got from spending under £5 and another one that got a huge response looking at what people did with their first pay packet. Also a Mastermind looking at car insurance.

Speaker names marked ? are inferred from speaking time and the show’s known hosts — they are not voice-verified.

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• 1:12Martin Lewis?

  Hello, I'm Martin Lewis and this is the cunningly named The Martin Lewis Podcast. I do wonder what that's going to be about. Usually, much of it comes from my BBC Radio Five live show with Adrian Charles, but there's bonus money-saving tips just for you lucky, lucky podcast listeners. Today's podcast is a special festive episode, a compilation of some of our timeless content from 2024. Brackets, yes, of course, you know and I know. It means I'm off this week, but we still wanted to put a pod out, so we're using some of the old stuff, which is still relevant, because it might well be worth you having a listen. And don't worry, though, it isn't going to be full of awful Christmas puns written by podcast producer Simon. You know I wouldn't bother with that. And instead, I prefer us to be the ho, ho, home of financial information.

• 1:57Martin Lewis?

  Simon! I told you not to put those in. So what are the ingredients of this Christmas pudding of a show? Well, something I'm always asked about is how do you save up as a first-time buyer? We'll be covering that as a big topic. We'll also be talking about everything you ever wanted to know about mortgages. And I've got a mortgage broker alongside me to help answer your questions. We've got tellers, too. What did you do with your first pay packet? And what's the most joy you've ever got from spending under a fiver? And of course, it wouldn't be the Martin Lewis podcast without just a little bit of money mastermind. You can think of that as the silver coin of Adrian Charles humiliation inside the tasty pudding. Play the theme tune.

• 2:59Martin Lewis?

  Well, now to the first of our best bits, something I'm always asked about. How do you save up for a deposit as a first time buyer? Let's listen.

• 3:08Speaker 06

  Lifetime ISAs then. LISAs, I think we know them as.

• 3:14Martin Lewis?

  You say Lysa, I say Lysa.

• 3:17Speaker 06

  What do I need to know about?

• 3:19Martin Lewis?

  The lifetime ISA is a product you can open when you are between the ages of 18 and 40. So the last day you can open it is the day before your 40th birthday. You can then save up to £4,000 a year in it and the state will add a 25% bonus on whatever you've saved. So if you save the maximum £4,000 a year, the state will add £1,000 in that year. And you can do that year after year and you keep getting the bonus until you are 50 years of age. But you can take the money out only for one of two reasons. Number one, you are buying a first time property. You've never bought a property before. You've never owned a property before. And that property has to be worth under £450,000,

• 4:04Martin Lewis?

  which is the key thing I'm going to come on to. The second reason is you've hit age 60 and then you can take the money out without and you get all of the bonus. No one who has opened a Lysa has hit age 60 yet because they haven't been around long enough and you have to be between age 18 and 40 to.

• 4:17Speaker 06

  Is there interest on it as well as the tax?

• 4:19Martin Lewis?

  You get interest on it as well. 5% interest. It's a savings account. It's just a tax free savings account. But the real key to it is the 25% state bonus. The problem with a lifetime ISA, oh, there are a few smaller ones, but the big one is if you take your money out for any other reason than to buy a first time qualifying property, or at retirement effectively, when you're aged 60, you take a 25% penalty. Now, here's a bit of maths for you. Have you got that calculator you had last week, Adrian?

• 4:48Speaker 06

  Yeah, go on.

• 4:49Martin Lewis?

  So let's say you've saved, tell me when you're ready.

• 4:52Speaker 06

  Yeah.

• 4:52Martin Lewis?

  I'll get you to do it. I know the answer. You've saved £10,000 in an ISA.

• 4:56Speaker 06

  £10,000, inputting now, Martin.

• 4:58Martin Lewis?

  Right, you get a 25% bonus. How much do you have in there?

• 5:02Speaker 06

  You will have 12, 1250.

• 5:06Martin Lewis?

  12,500.

• 5:07Speaker 06

  12,500. Hang on, 12,500.

• 5:10Martin Lewis?

  And you've got that in your calculator. Get that in your calculator because you need that.

• 5:13Speaker 06

  Yeah, yeah, yeah, yeah, yeah. Okay.

• 5:16Martin Lewis?

  You now have to pay a 25% penalty on the 12,500. So if you're struggling, times it by 0.75.

• 5:24Speaker 06

  Yeah, no, I can, yeah.

• 5:26Martin Lewis?

  What do you get?

• 5:27Speaker 06

  9,375.

• 5:29Martin Lewis?

  So you put 10,000 in, it went up to 12,500, but to take it out, you end up with?

• 5:34Speaker 06

  9,375.

• 5:36Martin Lewis?

  Which is £625 less than you put in.

• 5:40Speaker 06

  Right.

• 5:41Martin Lewis?

  So if you're taking your money out, not for one of those two reasons, you are effectively paying a 6.25% penalty to the state. Now, it was revealed this morning, we got the latest figures, that in the 2324 tax year, 15 million pounds worth of penalties were paid to the state. Now, I don't have that much of a problem with that, because that's to ensure that people are only using the LISA for the reasons intended. This is my problem. The LISA was launched in 2016. The property threshold limit in 2016 was £450,000. The property threshold limit is still £450,000. Many people, especially in London and the South East and other urban

• 6:22Martin Lewis?

  metropolitan areas, have been priced out by house prices going up. So they saved as the government told them to for their first time property, but their property is now above £450,000.

• 6:34Martin Lewis?

  And to take the money out, even to buy a first time property, which is what this product is for, they are facing a penalty, a substantial penalty. Now, our estimate is of the £15 million of penalties, and this is from some surveying by a company called Moneybox, is one of the providers, 12% were taking money out to buy another property, to buy their first time property. Now, I think, so, that's just about 1.8 million pounds a year of penalties are being paid by people using the ISA for what it's intended to do. Now, I wrote to Jeremy Hunt twice, and I've now written to Rachel Reeves to say, what I would like to see them do is reduce the penalty for those who are buying a first time property above the threshold to 20%.

• 7:18Martin Lewis?

  Now, the reason that is, is the maths then works out that if you put £10,000 in, you get £10,000 out. So, while you don't get the bonus, you don't actually have to pay a fine to the state for accessing your money for what this product was devised for.

• 7:32Speaker 06

  Surely that 450 should be linked to average house price inflation?

• 7:35Martin Lewis?

  Well, don't call me Shirley, but of course you're right. Of course it should, and that's the secondary proposal is link it. But in the meantime, whatever you do, I think to charge a fine to these people, now, the great thing about these numbers is that we can now do some rough maths. It means my estimate on the cost of this policy is you expect double the number of people would withdraw this way if there wasn't a penalty, is going to be around 3.6 million pounds, which in state financial terms is diddly squat. It's nothing, and there is a justice issue here. Many of our young people who've done what the state asked them to by saving for a first time property in a lifetime ISA are being fined by the state for accessing the money to do what the state wanted them to do. That seems to me to be unjust.

• 8:17Martin Lewis?

  I don't have an issue with fining people when they want to take it out for other reasons, that was always the case.

• 8:22Speaker 06

  Some other questions on this.

• 8:24Martin Lewis?

  Yep.

• 8:24Speaker 06

  What's the position for an individual with a save to buy ISA who marries someone who already owns a property? Can you buy half of it?

• 8:32Martin Lewis?

  Yeah, so, so I think you mean that's the help, that's the help to buy ISA, which is the predecessor of the lifetime ISA. If you've got one, you can use it, but you can't open one now, you can only open a lifetime ISA now, with both the help to buy. ISA and the lifetime ISA, it is an individual product. If you are buying and it is your first property and you're getting a mortgage with it, you will get the bonus. If you are buying with somebody else who's a first time buyer, you can have one each and you will both get the bonus. Sometimes people say to me, does that mean the property I can buy is 900,000 because there's two of us? No, the property limit's always 450,000. And if you are a first time buyer buying with somebody who's already owned a property, you can get the bonus, they can't. So it's an individual product.

• 9:15Martin Lewis?

  Whoever you are buying the house with is irrelevant. You can use it for yourself.

• 9:20Speaker 06

  Okay, the, this is an interesting one, I thought. Susan says, my daughter has a toddler and a low income, but she has a ISA. And as a result of years of frugality, she has, you know, she saved something. But this means she can't claim universal credit. So there was a rumour that ISAs would be ignored when making a claim for universal credit. And in a way, they should be because you won't, you know, you could potentially not see that money for another 30 or 40 years.

• 9:47Martin Lewis?

  I've never heard the rumour.

• 9:49Speaker 06

  Okay, you think it is going to count against you?

• 9:51Martin Lewis?

  Well, it does count against you. I mean, if you have over, if you have over 6,000 pounds in savings, the amount of universal credit you can claim is reduced. If you've got over 16,000, you cannot claim universal credit. And a lifetime ISA is a form of savings. It's money in the savings account. Just or not just, those are the rules and I am not aware anybody is planning to change the rules.

• 10:10Speaker 06

  Okay.

• 10:11Martin Lewis?

  I'm afraid.

• 10:12Speaker 06

  Are lifetime ISAs a sensible investment for parents to start making for their teenage children? What if that the rules will change down the line or something?

• 10:20Martin Lewis?

  Okay, so first question. You cannot do a lifetime ISA. Your child has to open a lifetime ISA. So I need to reframe the question as are lifetime ISAs sensible of something for me to give my child money to put in a lifetime ISA? If you see what I mean, I'm just making a distinct point. You can't go and open it for them. It's their product, they have to, because they have to be the right age and sign up for it. Absolute, certainly a quid. So let's go back to my quid rule. Yes. If your child is going to, from the day they're 18, on their 18th birthday, give them a quid in an envelope, give them the address of current top paying lifetime ISA money box, pays 5% interest. Let them put a quid in money box on their 18th birthday.

• 11:04Martin Lewis?

  Totally sensible strategy for anybody to do, except as a six and a quarter pence risk, but that's all you're risking. Look, I mean, if you're living in the north east of England, where you would be buying a very large property above £450,000 and that's where they're likely to buy, I think it is a sensible option. And I think it is a sensible option in most parts of the country. It's the £450,000 risk, but they, when you start to put serious money in it, remember that has to be towards a qualifying property. Now, if your child may decide not to buy a property, or that that's not what they want, or they're looking to move in and buy in a different country, then you're going to pay the penalty. So you have to assess that risk. Definitely get a quid in it.

• 11:43Speaker 06

  Felicity, should my son ditch his help to buy ISA in favour of a LISA?

• 11:49Martin Lewis?

  Okay.

• 11:49Speaker 06

  And I want the latter has succeeded the former. So do you have one of each?

• 11:54Martin Lewis?

  So you can have one of each, but you can only get the first time buyer's bonus on one of them. So there isn't much point unless you're losing LIsas for retirement savings, which is generally not recommended for almost everybody except self-employed, basic rate taxpayers. Higher rate taxpayers, you're better off in a pension. Employees, you're better off with your auto enrolment contribution than using a lifetime ISA. So, which is why, by the way, most banks don't offer lifetime ISAs because they're so worried people will use money for retirement savings and they'll be get done for misselling because of it, which is why the product, it was, it's a bad structure, the retirements, but we won't talk about that. We're focusing on first time buyers. So what was the question again? Because I've overtalked over myself. I have forgotten it.

• 12:34Speaker 06

  Well, you've, I think you've answered. Should you have one of?

• 12:37Martin Lewis?

  No, so no, I haven't. So, right. So you've got money in a help to buy ISA. These days, the transitional arrangements have gone. You can take money out of the help to buy ISA and you can put up to £4,000 a year in the, in the LISA. So if he's got 10 grand in the help to buy ISA, it's going to take him quite a while to put that money in the lifetime ISA. The bonus is the same. So it's a question of how much longer he would be saving for. So, you know, because you can only put 4,000 a year in the LISA, but if you're buying in 10 years' time, then you'd easily go capacity. Now, let's do the pros and cons. You can put more money each year in a help to, in a lifetime ISA than a help to buy ISA. So you can put more in. The lifetime ISA gives you the money at exchange. The Help to Buy ISA gives it you at completion.

• 13:20Martin Lewis?

  It is better to have it exchanged because you can use it for the house deposit. The Help to Buy ISA can only be used for the mortgage deposit. The Help to Buy ISA has no withdrawal penalties, so it's much more flexible. If you want to take money out of a Help to Buy ISA, you can just take the money out whenever you want. It's just like a savings account, although the interest rates are lower. The Help to Buy ISA can only be used on a property up to £250,000, except in London, where it's £450,000. So you have a much lower choice. So effectively, Help to Buy ISA is more flexible. Lifetime ISA, you can put more in and you can buy a bigger property on it. So it simply depends on your circumstances. And I'm sure you'll be able to find online someone has written an article comparing and contrasting the two.

• 14:03Martin Lewis?

  In fact, I definitely know someone who's done that, but I can't tell you who's written it.

• 14:09Martin Lewis?

  Now, a quick run through one of our tellers. With this tellers, we asked you, what did you do with your first pay packet? Fascinating answers.

• 14:18Speaker 06

  There's been some brilliant ones here. A mid 70s first wage packet, £2 on Saturday job selling coats on Leicester Market. Straight to the record shop to spend £1.99 on my first vinyl album, Mike Oldfield's Tubular Bells. So happy. I mean, people are just enjoying the memory. It's just, I think that's why this has got...

• 14:39Martin Lewis?

  When I wrote it, I wasn't expecting it. Wasn't expecting it to explode like this. I mean, as I say, over 2,233 responses on the Twitter and Facebook. You've got the, you've got Twitter, I do the Facebook one. So this is one from Han, who says, "First pay from a proper career. I think I treated my dad to a meal at Frankie and Benny's after months of him picking me up from work, treating me to dinner and taking me to buy groceries as I was on a super tight budget. I loved being the one to buy for him for once. Then I found he'd left me some cash just in case on my kitchen window sill before he left." Well, when you're a dad, you're a dad, aren't you? You know, when it's your kids.

• 15:17Speaker 06

  Do you know, it's brought back a bad memory for me. My first one, because I did a year between school and university working for my dad's scaffolding company. And my, and it was hard work. Anyway, I cut my wages and I took my, I took my girlfriend...

• 15:28Martin Lewis?

  It's left your rip now, Adrian, at least I can see. I mean, look at that, look at that figure.

• 15:32Speaker 06

  It's all gone. It's all my, I took my then girlfriend for a curry in Quinton in Birmingham. And I think the restaurant's still there. And it was very nice, but I got dumped shortly afterwards. Yeah. Just shows you, doesn't it?

• 15:46Martin Lewis?

  Moving on.

• 15:49Martin Lewis?

  Let's, let's keep the tone up. This is meant to be the jolly bit in the middle. Right, do you want to read another one?

• 15:53Speaker 06

  Uh, let's, shall we hear from Tessa? Tessa has sent us a, a voice note.

• 15:58Martin Lewis?

  It's a very, I like, a financial programme, having someone called Tessa is quite appropriate.

• 16:01Speaker 06

  It is.

• 16:02Martin Lewis?

  It's an old gag. You have been, you have been your late thirties to forties before you'd understand it, but well done, Tessa.

• 16:07Speaker 06

  We just need people to be christened Isa.

• 16:08Martin Lewis?

  Yeah, or, or Pep, if Pep comes on.

• 16:11Speaker 06

  Well, there is a Pep. Perhaps we'll get him, the great man himself to call in one day. He seems to have a sense of hue, but not. Uh, anyway, here's, uh, here is, here is Tessa.

• 16:20Speaker 02

  Hi, Martin, it's Tessa here. My first job was at the Wimpy in Farnborough on Saturdays. It was March 1984, I was just 16. I was paid one pound 10 an hour. And I spent my first pay packet on fabric at Fleet Market on my way home. I made a top and a skirt that I wore to a disco the following weekend. Happy days.

• 16:42Martin Lewis?

  Knowing how to make a top and a skirt at that age as well is pretty impressive, I think.

• 16:46Speaker 06

  Yeah, the game's gone. You wouldn't get youths being able to do that now.

• 16:49Martin Lewis?

  I've, I've got Angela.

• 16:50Speaker 06

  Mm-hmm.

• 16:51Martin Lewis?

  I was 14 in 1972. I used to clean the bathrooms at a large hotel in Southport. I think I got about nine quid. Straight off, it's the same again, straight off to Woolworths for a record. The rest was spent going out on the weekend. It went a long day, nine quid in those days.

• 17:05Speaker 06

  Mm-hmm. Uh, Craig, my first pay was 98 pounds. And I took my grandma out for lunch.

• 17:12Martin Lewis?

  Oh.

• 17:13Speaker 06

  Oh, God, that's so lovely.

• 17:15Martin Lewis?

  I like that.

• 17:16Speaker 06

  Uh, Ian got paid 35 pounds a week on YTS, bought a bus pass for 18 quid, 10 pounds to my mum for digs, 7 pounds left for a chippy and the football on Saturday with my dad. Good, all-round balanced spend, I'd say there, really.

• 17:30Martin Lewis?

  I like this one from Elizabeth.

• 17:32Speaker 06

  Mm-hmm.

• 17:32Martin Lewis?

  I think this is classy. Elizabeth, first pay packet, I went into a gallery I passed on the way to and from work and started to put money down on a painting I loved. It took me two months of paying some off weekly. 30 years later, it still hangs in my home. Wow, your first pay packet, you bought art?

• 17:52Speaker 06

  Yeah.

• 17:52Martin Lewis?

  I mean, you, that's high culture, as far as I'm concerned.

• 17:59Martin Lewis?

  Right, I'm here now with podcast producer Simon. We have lots more things that we need to go through, don't we, I think?

• 18:05Speaker 06

  Yeah, yeah, we've been inundated.

• 18:07Martin Lewis?

  So, let's start. Any LISA questions? Let's get those over and done with that we haven't dealt with yet.

• 18:12Speaker 06

  I've had this one from Michelle. My son has a Help to Buy ISA with the Halifax. The interest rate is rubbish. Is this the best option for savings for a house deposit?

• 18:19Martin Lewis?

  So, hopefully you will have heard earlier in the show that I talked about the pros and cons of Help to Buy ISA versus a lifetime ISA. Now, the first thing to say with both these products, you're not doing it primarily for the interest rate. Lifetime ISAs have better interest rates because they're a live product. Help to Buy ISAs are a legacy product, so the interest rate on those aren't as good. But either way, the prime reason for doing it is for the 25%. So, don't let the interest rate tail wag the dog. You need to do whichever one is better for you, the Help to Buy ISA or the lifetime ISA. And I've already talked about the differences. Now, if you are sticking with the Help to Buy ISA, then the best interest rate is offered by HSBC, but only for existing customers with a current account, at 3.5%.

• 19:03Martin Lewis?

  Halifax, where you have it, is next best on a 2.75% on up to £12,000, which is the maximum you can get a bonus on in a Help to Buy ISA. So, unless you're with HSBC, you're already in the best possible place. Now, you can transfer a Help to Buy ISA. So, if you have a Help to Buy ISA, you can open one in a new provider. Obviously, you can't open a new one because it's a legacy product, but you can open one elsewhere and ask them to transfer your existing Help to Buy ISA across, which is a way, and you do that by completing a transfer form. So, if you did happen to have an HSBC existing current account, or flexible saver, or Premier saver, then, or your son did, rather, then he would be able to apply to do a transfer at HSBC

• 19:46Martin Lewis?

  to shift his Halifax account across to get the 3.75%. Anything else on lifetime ISAs or have we done that?

• 19:52Speaker 06

  No, you've covered everything now.

• 19:56Martin Lewis?

  And back to Tellers, which is all about what you did with your first pay packet. And we've got a few nice ones that have come in by text, although the nature of being by text is most of them are anonymous. So I've got podcast producer Simon with me. Why don't I read the first one, Simon? "With my first pay packet, I went into town at lunch and bought a pair of high heels, patent leather, low-rise shoe boots with tiny gold studs on them. They were beautiful and I wore them till they fell apart." Is that yours, Simon?

• 20:27Martin Lewis?

  So there we go. Yeah. You can do the next one.

• 20:30Speaker 07

  Matty sent us one saying he was paid £160 for his first month at Sainsbury's. He spent it all on a 12-disc CD changer for his 17-year-old Fiat Uno. No regrets.

• 20:39Martin Lewis?

  12 discs, nice. This one, "My first pay packet was from Littlewoods Call Centre for selling fibre optic Christmas trees by cold calling, but I got two yellow cards during football games that week, so the entire lot went to the FA to pay for my fines." Oh, first money, straight in fines.

• 20:59Speaker 07

  I used to work as a football referee and the first time I gave someone a yellow card, he told me his name was Tommy Taylor and I didn't think much of it. And then afterwards, on the way home, my dad was like, "He's definitely given you a fake name to avoid the fine."

• 21:11Martin Lewis?

  And how did?

• 21:11Speaker 07

  Well, yeah, I never heard from him again.

• 21:13Martin Lewis?

  How much is a fine?

• 21:14Speaker 07

  Well, I mean, I was doing sort of kids' football, so it'd be maybe like between 10 and 20 quid, maybe.

• 21:20Martin Lewis?

  So it's quite a lot, actually, and it puts quite a lot of power in the referee's hands.

• 21:23Speaker 07

  Yeah, yeah.

• 21:24Martin Lewis?

  I have to say, I didn't know that you were fined when you paid. That's, that's, yeah. Yeah. So if you were in a bad mood that day, it's going to be quite expensive.

• 21:33Speaker 07

  Well, yeah, but it was already, you're already getting quite a lot of gyp from like the parents of the players anyway. So, I mean, you're hitting them in the pocket as well. And they were the people that paid you. So, you know, you didn't want to get on the wrong side of them, really.

• 21:45Martin Lewis?

  I should move on quickly. I got this one. "Hi guys, my dad was a builder. My first job was for him, cleaning the bricks. He gave me a penny a brick. Unfortunately, he also not long after bought a one-armed penny bandit. I lost a lot on that." Oh, clever dad. Clever dad. Puts a, gets paid your penny and then gives you somewhere to spend it straight afterwards. That was Gavin from Reading. Have you got one more, I think, to finish?

• 22:08Speaker 07

  We've got this one from Carol. "In the early 90s in the French Alps, I decided to rent a small studio flat. I stayed up all night and read Lord of the Rings. By the morning, I could see the elves in the distant mountains."

• 22:19Martin Lewis?

  Oh, what a nice one to finish on.

• 22:23Martin Lewis?

  Now, my favourite bit of the show. Time for Money Mastermind.

• 22:33Speaker 06

  Do I need a calculator?

• 22:34Martin Lewis?

  You do not need a calculator. So, welcome to Money Mastermind. For those who don't know, it's a question that we put forward. Adrian's current record is he has two right and one wrong.

• 22:43Speaker 06

  I think I'm going to equalise myself.

• 22:44Martin Lewis?

  Rather impressive.

• 22:45Speaker 06

  Yeah.

• 22:46Martin Lewis?

  Now, they say the car reflects the man. So, none of you will be surprised to hear that Adrian drives a mud brown 1989 Volvo Estate with go slower stripes.

• 22:58Speaker 06

  It's a Maxi, actually.

• 22:59Martin Lewis?

  Sorry.

• 23:00Speaker 06

  Austin Maxi. I'll go with what you say.

• 23:02Martin Lewis?

  The nearest... I'm very pleased with this next line, by the way. I'm not sure I should say that in advance. I think you shouldn't telegraph that, anyway. The nearest he's... Dude, he's making me laugh there. The nearest he's ever got to a spoiler on his car is when someone wrote in the dust on his back window who had won the second series of The Traitors.

• 23:20Speaker 06

  Very good.

• 23:21Martin Lewis?

  I'm pleased with that.

• 23:22Speaker 06

  Very good.

• 23:23Martin Lewis?

  Thank you.

• 23:24Speaker 06

  Very good.

• 23:25Martin Lewis?

  Now, it's time for him...

• 23:26Speaker 06

  I'll be your straight man. You don't have to do this for yourself.

• 23:28Martin Lewis?

  Okay.

• 23:29Speaker 06

  I'm so happy to do it for you, Mark. Anyway, go on.

• 23:31Martin Lewis?

  Now, it's time for him to get his car insurance. Thankfully, all those years on consumer programmes has helped and he knows not to auto-insure. Instead, he went to a new comparison site targeted at people just like him called, I've no enthusiasm for this but know I need it, dot com. I very much enjoyed writing this. There, he was shocked to find... This is the important bit now. There, he was shocked to find it was offering him a substantially cheaper quote from exactly the same firm as his current insurer with exactly the same policy. So, you've got your renewal, but you're going through a comparison site, same firm, same policy, is cheaper. You with it?

• 24:16Speaker 06

  Yep.

• 24:17Martin Lewis?

  So, Adrian, what I want to know is, in that case, which of these is your legal right? A, you can require your existing firm to lower your quote to the same as the comparison site because the law says existing customers must be given the same price as new customers. B, you can do similar, but you must first renew your existing policy, then ask it for a refund of the difference because the law says existing customers must be given the same price as new customers. C, nothing, it is allowed to charge you a different price to that of a new customer.

• 24:56Speaker 06

  Hmm, I would worry it was option three. I suspect it's option two, but I'm going to go for option one. I'm going to be positive and think that the law is framed like that.

• 25:11Martin Lewis?

  So you're saying that you can require your existing firm to lower your quote to the same as the comparison site because the law says existing customers must be given the same price as new customers?

• 25:22Speaker 06

  No, change my mind, I'm going to go for the second one. So they're gonna, so they...

• 25:24Martin Lewis?

  You have to buy it first and then you get the difference back. Okay, so that's option two, we've locked that in, that's your final answer.

• 25:30Speaker 06

  Yeah.

• 25:31Martin Lewis?

  Right. Now, a couple of years ago, they did bring in the loyalty penalty war to ban price walking, which is where what, what happens is each year you stay with one insurance firm and it walks the price up a little bit, far more than it would charge a new customer. So after five or six years, you're paying 60 or 70% less, which is why I always say don't auto renew. And that law is in place now. So the general principle is existing customers should not be charged more than new customers. The general principle.

• 26:02Speaker 06

  Right.

• 26:03Martin Lewis?

  Is the operative bit here. So before I go on, can I play the uh-uh?

• 26:08Martin Lewis?

  Oh, have you got it? This is the problem, and this is what everybody needs to understand because I get a lot of questions about this. The same price for new and existing customers rule is channel specific.

• 26:22Martin Lewis?

  Now, what that means, for example, if you got insurance direct from the firm, your renewal must cost the same as a new customer going direct to the firm. If you got your insurance via a specific comparison site, then your renewal must cost you the same as a new customer going via that specific comparison site. Not going via a comparison site, going via that specific comparison site. Now, I frame this question, if you remember, you went to a new comparison site, so by definition, you could not have been an existing customer of it before on your renewal. And therefore, the new and the existing customers being charged the same as new customers rule does not apply. And this gives insurers some wriggle room.

• 27:07Martin Lewis?

  One, it means they can put specific offers through comparison sites, which means a comparison site can be cheaper than a direct renewal because they don't have to offer their existing customers direct renewals. And two, they could vary which comparison site year by year they're giving special deals to, so that the renewal customers only have to be given the same price as those who went through a specific comparison. So loads of people get in touch with me and say, I thought they'd got rid of this rule. I've got my renewal quote, but I found it so much cheaper on a comparison. Why are they charging me as a new customer, much less than as an existing customer? Because the rule is channel specific. Makes sense?

• 27:44Speaker 06

  Yes, so am I missing something? But, I mean, it's annoying, but why not just go with the new, the new quote through, go with, through the new comparison site and just get it done? And don't trouble yourself with wrangling with, annoying though it is.

• 27:58Martin Lewis?

  So you're absolutely right, and of course, that's what you would do. But in practice, my point is in principle, my concern about this new rule where, where it was promoted that existing customers can't be charged on new customers is it's given people a false sense of security that their renewal is there for a good price. Because they think, well, it's the same price as a new customer would get. And people are shocked because they should do a comparison anyway in case your existing insurer is not the cheapest for you. But people are shocked when their existing insurer is the cheaper, is cheaper on a comparison site because they thought that rule had changed. So it's not about the practicals, it's about the, I want to get... Get rid of that false sense of security that you have out there that I don't need to go elsewhere because I know my renewal company at least will be giving me a same price as

• 28:40Martin Lewis?

  a new customer coming to it. Well, only in a channel specific way. And it is still massively important to go and do a cross market comparison, use more than one comparison site, you know, add in the likes of Direct Line who aren't on comparison site because firms have ways around those rules and gemming those rules.

• 29:01Martin Lewis?

  Moving on, the next of our best bits is everything you need to know about mortgages. And as it's a regulated subject, I brought along Monty to join us and help me answer your questions. Have a listen.

• 29:13Speaker 06

  We're looking at mortgage deals this week.

• 29:15Martin Lewis?

  We are indeed.

• 29:16Speaker 06

  There's a man sitting outside the studio.

• 29:18Martin Lewis?

  I'm going to wait.

• 29:18Speaker 06

  Is he him? He looks like a mortgage broker. He's got, he's got that, he's got that look about him.

• 29:23Martin Lewis?

  Come on, Monty.

• 29:24Speaker 06

  Monty, come on, Monty, you're on. We've been through this. And he's sitting, come on, in your com.

• 29:30Martin Lewis?

  So I should say, Monty's name is not officially Monty.

• 29:35Speaker 06

  Right.

• 29:35Martin Lewis?

  It's Andrew Montlake, Andrew Monty Montlake, who is managing director of mortgage brokers Corico. Now, the reason Monty fit in-

• 29:42Speaker 06

  I'll call him Mr. Mr. Monty.

• 29:44Martin Lewis?

  No, he, I'm going with Monty.

• 29:48Speaker 06

  What's- You can call me whatever you like. I'll call you, oh, well, don't tempt, don't, don't tempt me.

• 29:53Martin Lewis?

  Don't give him that. So listen, this is, this is the point. Let's be, mortgages are a regulated area. And I'm a journalist, Monty is a regulated broker, so he can give bespoke specific answers. Now, let's be plain, this is, this is a radio show. He hasn't going to be doing a full fact find. So this is mainly pointing you in the right direction. You should still go and speak to your own mortgage broker, depending on exactly what's going on. But there is a hell of a lot going on in mortgages at the moment. Mortgage rates are finally dropping. The cheapest five year fixes are easily limboing below 4%, while the cheapest two year fixes are just scraping under 4%. And this is even though the Bank of England voted to keep interest rates on hold at 5% last week. And what people need

• 30:37Martin Lewis?

  to understand is while the Bank of England UK base rate tends to dictate how variable rate mortgages, standard variable or tracker mortgages move, variable rate mortgage can also move for other reasons too, they move with the Bank of England base rate. Fixed rates, the rate of a new fix, they tend to move with city swap rates, which to oversimplify to an extent, are the market's prediction of future interest rates. So the market, what we can see is saying, look, we think interest rates are dropping and dropping longer in the long term, which is why five-year mortgages are cheaper than two-year mortgages. So we've seen fixed rate mortgages come down. Now, the expectation, the market consensus,

• 31:22Martin Lewis?

  is in November we'll have a rate cut. That's not a prediction. That's what the market thinks at the moment. Things can change. And some of that has already been priced into the rate that you can fix at now. So as mortgage rates have come down, it's starting to look like those people who are on standard variable rates or are coming off their fixes are going to be able to get decent deals. Now, I'll ask Monty, as he's here, the big question people would ask is, should I fix now or should I wait because it might get even cheaper? I know my answer, but you go first, the regulated one.

• 31:55Speaker 06

  Yeah, it's the most common question at the moment. And it really does depend on your circumstances. What we tend to do is we talk to people six months before their rate is due to expire. And we go through a whole process.

• 32:10Martin Lewis?

  And just to say, that six months is crucial. If you are ending, your rate is ending, six months is the time that you need to start. So if you don't know when your rate ends, go get your diary out right now, find out when your deal ends, and go put a marker in your diary or your electronic diary six months before that says, mortgage time, start sorting it now. Anyway, carry on, sorry.

• 32:30Speaker 06

  Yeah. So what we would do is then we'd talk to that person and potentially we would lock into a rate now. So say your rate expires in six months' time, we'd lock into a rate now. But we would continue to review the market with your current lender and the rest of the market as well, up until around about four weeks before you actually are due to complete. So you can change, even if you, in principle, lock into a rate now, you can still potentially change that rate if things... Things get better. Now, a lot depends on your risk attitude. That's really the key issue.

• 33:10Speaker 06

  If you are worried about the risk of rates changing, then potentially you can lock in now.

• 33:19Martin Lewis?

  So, I mean, effectively, I mean, I often talk about that as an insurance policy. So if you can lock into a fix now that you will not have to pay a big penalty to get out of or a big fee to get out of later, then you can bank a rate now, but keep monitoring as you get closer to your, to the time that your mortgage deal is ending, your mortgage fix is ending, keep monitoring. And if a better deal comes along, ditch this rate, might cost you a small administration fee to do so, but it's small in the big scheme of things and move to a cheaper deal. But I also think, I mean, I've spoken to a lot of mortgage brokers about this. And most people are saying, while mortgage rates may shave down towards the end of the year, no one's really expecting them to be a substantial step change in rates from where they are now, are they?

• 34:03Speaker 06

  Not massively. Again, it depends who you read.

• 34:06Martin Lewis?

  I mean, we might go from 3.7% to 3.5% on a five year.

• 34:09Speaker 06

  Yeah, and your point earlier was true, Martin, in terms of a lot of this is already baked in. And we look at swap rates. So that's the future cost of funds upon which lenders base their fixed rates. And those swap rates have already priced in another rate cut this year. And looking ahead in the future, if you look at five year money, that's around three and a half percent. So that expectation is that rates are going to fall by another 1% next year, but.

• 34:41Martin Lewis?

  And we're similar to what the governor of the Bank of England has signaled as well.

• 34:43Speaker 06

  If the last two, three years has taught us anything, it's to expect the unexpected. No one predicted the whole debacle around the Liz Truss budget, for example.

• 34:52Martin Lewis?

  But if the predictions are right, I think the message that's coming out is, if you wait, there may be a small marginal gain. But if you're waiting and your fix has come to an end or you're on the high standard variable rate, which is up around 8%, then the small gain from waiting is easily outweighed by the massive cost of being on the standard variable rate. So you may as well go and get your cheap deal now anyway, because you do not want to be on your expensive standard variable.

• 35:19Speaker 06

  Yeah, correct. Let's bring Stephanie in. Got a question for you gentlemen. Stephanie, how are you?

• 35:25Martin Lewis?

  I'm very well, thank you. Thank you for taking my call.

• 35:27Speaker 06

  Go on, do you fire away?

• 35:29Martin Lewis?

  Oh, thank you. Right, I am coming out of a five-year fix. It finishes in February. I had the note in my diary. Thank you, Martin. It was already there.

• 35:37Speaker 06

  Good.

• 35:37Martin Lewis?

  And and we're coming out of a lovely 1.59 and I'm looking at what's on the market at the moment. What we did to come into this house was extend our years up to the max, which was 35 at the time, to have lower mortgage payments and we have started overpaying our mortgage. What is the advice going forward? Do I fix for another five years? Do I extend the years as well on the mortgage term? Do I look to overpay or do I put the money in a savings account if I can do that and then make a capital overpayment? What's your advice? Very interesting from me, just on the savings point. I would probably not have been overpaying at this point.

• 36:20Martin Lewis?

  For the simple reason you can earn 5% in savings and your mortgage is costing you 1.59%. So, you know, if you think of putting money into the mortgage is like saving, because it's reducing the debt by that amount, you're saving at 1.59%, you could have been saving at 5%. I would have probably been saving in a savings account, but the tax would take some of that off if you had a lot. But then when you come to the point of remortgage, I would have just made sure I got a smaller remortgage deal. Because as soon as the interest rate jumps up, I mean, let's be honest, even with the best will in the world, you're going to be paying nearer 4% than than 1% at this point, then I would have probably thought, even though you can earn a bit more, I'd probably have thought of clearing the mortgage. But but I don't think you've made a very big mistake, so I don't want you to feel bad about it. I mean, I'm just being, I'm just just for anybody else listening.

• 37:05Martin Lewis?

  If you've got a really, really low rate mortgage that you can earn very substantially more saving, you should still be, you should be saving to to reduce the future mortgage. I mean, you shouldn't be spending, you should be saving to reduce the future mortgage and that will probably marginally help more. But let's let's put this to Andrew. So there was a number of different options there. What do you think?

• 37:24Speaker 06

  Um. Yeah, that I I actually agree with that. I thi- I think actually if you're coming to to renew now, then at the remortgage time is a really good chance to then pay off a lump sum of your mortgage then, because you'll have no penalties for doing so at that time. And then you take a smaller mortgage and then if you can, I mean, look, I'm a mortgage broker, but our job is to help you pay off that mortgage as quickly as possible. So if your interest rate is going into the 3.8 to 4% level, then it does make sense to try and clear that mortgage as quickly as possible. And if you can reduce the term back down, um, so you pay it off quicker, you're going to pay less interest.

• 38:07Speaker 06

  You're going to pay that mortgage off quicker, and that's probably a good idea. Whether you take a two-year fix or a five-year fix then depends upon your attitude towards risk and what you do think is going to happen to interest rates.

• 38:21Martin Lewis?

  Yeah, so just a couple, I mean, just to be technical, you're saying pay off your mortgage. Of course, at the point of remortgage, you're actually just going to get a smaller future mortgage. You're not going to pay it off.

• 38:30Speaker 06

  Correct.

• 38:30Martin Lewis?

  You're just going to borrow less. If it's said, what what I, I think I need to, how near the brink will you be on the new three, four, well, four percentish mortgage rate? Because obviously you you were you were playing it because you got a long term. That meant that affordability was obviously an issue for you. Is it still, is it still an issue? Or have you been on to a calculator and seen roughly what you'd be paying at 3.54%?

• 38:54Speaker 07

  We have, and we can do that as well. Um, it obviously is going to pinch a little bit. It's going to be somewhere between three and 400 pounds a month more than what we're paying already. So but our LTV is pretty good. We're looking at 50% LTV. So hopefully we'll have access to good rates.

• 39:09Martin Lewis?

  So let's just take the LTV for a moment to explain to everybody listening. LTV stands for loan to value. It is the portion of your house's current value that you're borrowing. So if you had a £100,000 house and you had a £60,000 mortgage on it, then you're borrowing 60%, that's your LTV. The lower the LTV, the better. And once you get below 60%, you don't get any improvement in interest rates. If you're above that, then roughly each 10%, roughly, roughly, roughly, then you're able to get a lower mortgage, the better your LTV. So using savings to reduce what you're borrowing, if you've got a higher LTV, I mean, you're borrowing more of your house's value, can actually reduce your mortgage interest rate or an increase your choice of mortgages out there.

• 39:53Martin Lewis?

  Have we answered your question properly? Because I know it's a big question. Is there anything else we're missing?

• 39:59Speaker 07

  It's just the advantages really for me over extending the years in order to keep the payments lower. And then is it worth doing that, do you think? Or should I put the mortgage at, say, 25 years and pay a bigger amount now? Or do I extend it to get a lower monthly payment and then put the rest of that money away?

• 40:19Speaker 06

  Oh, I don't have to make that calculation.

• 40:21Martin Lewis?

  Well, I mean, the point is, you can always overpay. So the question is, are there any penalties or any amounts that you can't overpay? And so, you know, if you were to extend the mortgage and then overpay, so you're paying the same equivalent amount that you would be on a on a 20-year mortgage, even though you've got a 35-year mortgage term, and there weren't any penalties, and you made sure they applied it as a capital payment each time, if they're just reducing the interest, that's not what you want, then the maths works out the same, doesn't it, Monty?

• 40:50Speaker 06

  Yeah, I mean, basically, most lenders now, if you take a five-year fix and because you've got 50% loan to value, you could get around about 3.8% actually now. So that's good. Lenders on a five-year fix generally allow you to pay off 10% per annum without penalty. So it's important to check those terms and conditions. But yes, doing the maths, I like to build in some security. So if you can overpay that way, that's probably the best way to do it, rather than taking yourself to the ultimate pinch point first of all, so you don't have any room for manoeuvre.

• 41:28Martin Lewis?

  Yeah, don't shorten.

• 41:29Speaker 07

  That's what I thought.

• 41:30Speaker 06

  Car breaks. Exactly.

• 41:32Martin Lewis?

  Yeah, but if you shorten your term and you can't pay, you're in mortgage arrears. So if you keep a longer term and overpay, then you've got the flexibility that if you have a bad month, you can stop. So yeah, I mean, I blogged on that years ago. I think I'm just trying to remember. Yes. And that that looks to me the right way to go and Monty the right way to go. It seems like we've answered it all, Adrian. We can move on. Thank you for your call.

• 41:52Speaker 06

  Stephanie, thank you very much. Thanks very much for coming on. Guy says, what are the pros and cons of an interest only mortgage at the age of 56?

• 42:02Martin Lewis?

  I'll go straight to Monty for that one.

• 42:04Speaker 06

  Thanks.

• 42:04Martin Lewis?

  He's going to struggle to get one, isn't he?

• 42:06Speaker 06

  Yeah, no, it's quite interesting, the way the market's moved, actually. And there's a whole market now in terms of later life mortgages. So interest only is available for you if you are at the age of 56. You just have to watch. Certain lenders have age restrictions. So for example, you can't have an interest only mortgage over the age of 70 with some lenders.

• 42:31Martin Lewis?

  So does that mean if you're 56, you can only have a 14 year term?

• 42:35Speaker 06

  Correct.

• 42:36Martin Lewis?

  So it's not that you can't, it's not that you can't get it once you're age, you can only get it till 70. It's that the mortgage must be, have ended by the time you're 70. So the term would be limited at 56.

• 42:47Speaker 06

  That's right. And so the advantage is obviously you do have lower payments, but remember, you're only paying the interest off, you're not paying the capital at all. So you do have to be prepared that at the end of the mortgage term, there will be a knock on the door and they'll want their money back. And then you might have to sell your property. Alternatively, there are some building societies and there is a whole retirement interest only mortgage available now, that if you're earning income well into retirement, depends what you do job wise, potentially you can extend that term well beyond age 70. So one of the biggest ones I've done is a 25 year interest only term for someone

• 43:31Speaker 06

  who was 70. And because of their income was secured, that could still be done.

• 43:37Martin Lewis?

  So to me, I think the answer on that one, the real answer is that is one of those situations you need to go and get one on one bespoke help from a mortgage voter, a mortgage broker, not a voter, a mortgage broker from.

• 43:49Speaker 06

  Ant has been in touch and he's a first time buyer. I mean, in his favour, he's got a sizeable deposit. However, he's a freelancer, therefore he's not on a fixed income. Is this going to be difficult? Well, it's always flipping difficult as far as I can say one way or the other, but.

• 44:07Martin Lewis?

  Self employment and freelance mortgages are always going to be harder. They're more difficult to prove and they can, there can be much bigger stumbling blocks. And I don't think the system has yet, you know, got to where it needs to be. So if it came, if it came to you, what would be your start point? And he said, am I going to get a mortgage? What would you say?

• 44:24Speaker 06

  Well, first of all, I'd say it is more challenging, but the good news is that lenders are getting better and better and better at dealing with people on contracts or self-employed. So it would depend upon your unique position. So it is really important to get that advice. So are you on a contract? What's the term of that contract? Have you got a history of similar contracts? Some lenders, for example, will look at your day rate. They'll times that by five and then times that by 46 or 48 weeks to get a basic income figure and then they'll use that. Others will look at accounts. They might look at your net profit. They might look at your retained profit.

• 45:06Speaker 06

  So there is a whole wealth of lenders out there, both mainstream and specialist, who will be able to help, but you do need to get that advice to go to the right lender.

• 45:15Martin Lewis?

  So what I don't want this to do is it be a constant go to a mortgage broker. But the more difficult you be, although generally I think most people should go to mortgage brokers. But the more difficult it is, the more you need one on one guidance. And the reason I tend to suggest people go to mortgage brokers isn't because there aren't very capable people out there who could go and sort out their mortgage for themselves and understand what's going in the scenario. It's because a lot of the data on affordability and credit scoring that individual lenders have and their terms of who they will accept and won't accept is not public, but brokers have it. Whereas we, consumers, don't have it. So if you're going to say, which lender's going to give to me that fits my circumstances as a freelancer?

• 45:57Martin Lewis?

  It's very difficult to get that data yourself. That's where the mortgage brokers come in. That's where the intermediaries come in.

• 46:07Martin Lewis?

  Now, we're going to nip over to another tellers that we did. Very simple. The most joy, and I only want joy. This is to spread happiness. It's festive time after all. The most joy you've ever got from spending under a fiver. Now, normally you get Twitter.

• 46:22Speaker 07

  Yeah.

• 46:23Martin Lewis?

  And I get Facebook. But I have stolen one from Twitter because I liked it so much.

• 46:27Speaker 07

  Go on.

• 46:28Martin Lewis?

  And this is it from Steph. And it got enormous numbers of likes. My mum spent £1, reduced from a fiver, on a twig in a box in Woolworths. A little bag of dry compost tied to one end was the only way to tell which end was the root. I thought I'd give it a chance. And 22 years later, this acer tree, and she's got a pic of this huge acer tree with the most beautiful orange golden leaves spread out in a wonderful wide canvas. It must be about 10 foot tall. It's absolutely gorgeous. This acer tree is the result, and it was beautiful. So what a good £1 for a twig in a box.

• 47:08Speaker 07

  I've got a similar one that came into the show. My wife has wanted a plum tree for years now. We've got a bee on plum there, Al, but I'll let that pass. I think you mean a plum tree, as in plums. While visiting a local garden centre, she ran up all excited about a tree she had found. An RHS Queen Elizabeth plum tree, reduced from £69 to a fiver. One very happy wife and free fruit to keep us regular. These things matter with age. Good job you had a sunroof. I mean, that's not for keeping regular. That's for, I assume, for having the top of the tree poking out of it.

• 47:45Martin Lewis?

  I've got this one from Sally Ann. I became a single mum 14 years ago when my husband left me. I was left with our then 18-month-old daughter, didn't have much money, and spent £3.50 on a dobbie horse that made a horse noise when you pressed its ear. That was the only thing I could afford to buy for Christmas. I cried for days out of guilt. She's nearly 16 and still has it and won't part with it. She says it was her best Christmas present and it still works.

• 48:12Speaker 07

  Love it. I love this one. Bella says she bought some orange plastic picnic spoons for a pound that, for some reason, my then-two-year-old nephew decided was the greatest toy ever. Spent months playing teaspoon cricket. He's now, he's now thirteen and trying out for his county cricket team.

• 48:30Martin Lewis?

  Oh, good luck.

• 48:30Speaker 07

  I still have the spoons also. Scott says, I've got a potato peeler with orange string around the handle. Suspect it will outlive the human race as it never goes blunt. I've got a big thing about kitchen utensils. And I'm, I've got, I've got a favourite spoon and everything, but I know what you mean about that. Perfect peeler.

• 48:48Martin Lewis?

  Well, one of my best, one of my best ever buys, and it was more than five, so I can't say it in there, but I'm going to give now. It's got a plastic casing and a lid on the top, and then it's got blades underneath and a pull string. Like, so you pull it back with a handle on the top.

• 49:02Speaker 07

  So like starting an outboard motor.

• 49:04Martin Lewis?

  Yeah, and so it's only small, it's only, you know, it's maybe, what, fifteen centimetres in diameter? And you can put vegetables in there and the blade, and then you pull it back. And it speeds the blade round and it chops them at super speed. I love it. I absolutely love it. I make amazing guacamole with it. I can chop up a salad with it. And whenever we've had friends.

• 49:26Speaker 07

  Well, how much salad can you get? I want one. Where, where, how do you?

• 49:29Martin Lewis?

  Well, I don't want to get, I don't want to give the brand name because it would be advertised.

• 49:31Speaker 07

  Can you still buy them?

• 49:32Martin Lewis?

  Yeah, you can still buy them. They cost, I think they're about a tenner.

• 49:34Speaker 07

  Right.

• 49:35Martin Lewis?

  Right, it costs a tenner and you pull it back and it, it does it so easily. You don't need any process. It is so quick. The guacamole is amazing and my top tip, and when I've had friends round, they go, I can't believe you're going to put that in there. Is I put my guac and I put my garlic and I put my lime. I put a little bit because I saw this abroad and they had a beautiful burrata cheese that they put in the guacamole. But I just use like a, you know, a cheese, cheese triangle, put a cheese triangle in the guacamole.

• 49:57Speaker 07

  A dairy leaf.

• 49:58Martin Lewis?

  I didn't say, I'm not doing brands. It could be any brand of cheese triangle. And I put.

• 50:02Speaker 07

  In a guacamole?

• 50:03Martin Lewis?

  In a guacamole. It's amazing.

• 50:04Speaker 07

  I hope we're not going out in, in Mexico.

• 50:06Martin Lewis?

  All right.

• 50:06Speaker 07

  You're, you're gonna be.

• 50:07Martin Lewis?

  So anyway, so you pull this round, it chops it up, but literally, because I've had it out in the summer when people have come round and I've made fresh guacamole because you can do it in front of them. And I have at least nine, I have at least nine friends who've bought one since because they see it and they go, that's amazing. And they bought it since.

• 50:24Martin Lewis?

  Now, back to mortgages.

• 50:26Speaker 06

  Let's go to Elgin, where Joe is waiting to join us. Joe, what have you got for Martin?

• 50:31Speaker 07

  Hello.

• 50:32Speaker 06

  Hi.

• 50:33Speaker 07

  I'm 56. My marriage has broken down. We're going to have to sell the marital home. I'll be lucky to walk away with about 50 grand. I've got a small inheritance coming my way, but I will need a mortgage. And my question is, what are my chances of getting a mortgage at my age? How long will I be able to pay it back over?

• 50:53Martin Lewis?

  So I think the first thing to say is, sorry to hear that.

• 50:56Speaker 06

  Sorry for your stress.

• 50:57Martin Lewis?

  And it's a very difficult and stressful time. It's great that you're looking after the finances because some people ignore them at that time, but they are crucial for you to rebuild your life and get on and get some happiness back in that life. So, I mean, the biggest answer, and sorry for asking you on the radio before I turn you over to Monty, because it's definitely one for him, is we sort of need to have some idea of what income you've got coming in, because that's the crucial, you know, two things you need to buy a house, you need some capital, some savings in order to build up your deposit, and you've got that. But then what really counts is what can you afford? So we need a bit of a clue on that, I'm afraid. You don't have to be too specific if you want to give it.

• 51:29Speaker 07

  No, no. I've just gone back to work full time to make the mortgage more affordable. So I'll be on about 28,000 a year. I've got three pensions put into. I know how much each of them are worth as well.

• 51:44Martin Lewis?

  And what sort of value house are you looking at in the area you live in?

• 51:49Speaker 07

  About 150. So I'm looking at probably getting a mortgage of about 80.

• 51:53Martin Lewis?

  So you've got, on 26, you're talking you've got a 50 grand deposit and roughly four times income on top of that. That's doable.

• 51:59Speaker 07

  I'll have.

• 52:00Martin Lewis?

  You're going.

• 52:01Speaker 07

  I think I'll have about 70, 75 maybe deposit.

• 52:04Martin Lewis?

  So you're basically looking at 70 grand deposit and three times income, gross income, rough. That's doable. That's very doable, isn't it?

• 52:11Speaker 06

  Yeah, that's definitely, definitely doable. In terms of how long you can take it.

• 52:16Martin Lewis?

  Did you just breathe a sigh of relief there?

• 52:18Speaker 07

  Yes, I did.

• 52:19Martin Lewis?

  Good. Yeah, I mean, you should get a mortgage and the age, I don't think is going to be much of an issue. But I'd like Monty to be more specific.

• 52:24Speaker 06

  Yeah, so Joe, in terms of age, basically it depends on what you actually. Do for a living. So most.

• 52:30Speaker 07

  I sit in my backside on an office in a job I love.

• 52:34Speaker 06

  Well, that's great. You're in a job you love. So a lot of lenders will go up to age seventy without too many issues. You've mentioned you've got pensions, so that's another good thing which lenders will take into account. And dependent on those levels of pension income, you might be able to go up to age seventy five or even age eighty and beyond. Dependent on the type of lender that you go to. But some of the mainstream lenders will go up to age seventy five without too much of an issue.

• 53:04Speaker 07

  I have spoken to a mortgage advisor and she said, well, you I could take some of some money out of my pension. That sort of scared me because then I'm thinking I'm not left to live.

• 53:14Speaker 06

  Yeah, I don't with it's one of those where I'd need to sit down and know your full details. But I wouldn't rush to take money out of your pension to do this because from from what you've just explained. It doesn't sound like you need to.

• 53:28Martin Lewis?

  No, you don't have to go to the first mortgage broker you use either. You may want to go and get ask speak to somebody else. And just a note on mortgage brokers. Look, as I said before, I'm generally in favor, very strongly in favor because they know about acceptance criteria that aren't available to the public. And also, especially if you don't know what you're doing, they do know what they're doing. That's what they're qualified professionals for.

• 53:46Speaker 06

  But how are they? But how are they paid? And is that clear?

• 53:49Martin Lewis?

  So it depends. So there are there are free free brokers out there who just take commission. They will tend to walk off, hopefully a large panel of lenders who will give them commission. But they probably won't look at the the few lenders who don't pay commission on the end of that, and that is allowed. There are brokers who take a fee and commission, which can mean they're looking at a slightly wider range. And there are some brokers who'll work fee only and rebate the commission for you. So there are all these different options. But even as long as you're working as a sort of an independent mortgage broker who's going cross market. Even if they're not looking at every mortgage out there, that's a lot better than doing it for yourself. So you'll have to look at the fee stretch. I mean, there's other questions. Are you happy to do it on the phone?

• 54:31Martin Lewis?

  Or do you want to do it face to face? And they can affect the fee that is being charged as well. So there are lots of different types out there, but the the one. Big rule, the golden rule from me, you should not be paying any broker unless they get you a mortgage. You don't pay a broker to go in and talk to them and chat. I wouldn't be paying upfront. You wouldn't pay upfront, would you?

• 54:51Speaker 06

  We don't charge upfront.

• 54:53Martin Lewis?

  Most don't. I mean, very few.

• 54:54Speaker 06

  There are some do, dependent on complex circumstances. But yeah, it really does depend.

• 55:00Martin Lewis?

  But there is certainly a choice out there where you do not need to pay anybody upfront until you get a mortgage. And I would always tend towards that arm. Again, I mean, look, if you're getting an 18 million pound mortgage that's mortgaged on, secured on your shares that you happen to own in the company and stuff like that, you're probably going to need to pay for it. We're talking about standard, normal circumstances here.

• 55:22Martin Lewis?

  Got a few more of those first pay packet tellers to go through now. I've got podcast producer Simon with me. What have you got?

• 55:29Speaker 03

  We've got this one in from Chris. A Kylie Minogue CD, greatest hits, discounted on Amazon. Music for a lifetime. Fun, joyful, never gets old.

• 55:37Martin Lewis?

  I should be so lucky.

• 55:38Speaker 03

  Yeah.

• 55:44Martin Lewis?

  Sarah, in around 1977, I bought this doll for £5. My mum was cross and said it was a waste of money and it wouldn't last. And it's, you can't see the image, but it's one of those dollies that you pull a string and it sort of moves its legs and jiggles around. Still going strong after 47 years.

• 56:00Speaker 03

  We actually got sent in this voice note from Jade.

• 56:03Speaker 04

  Hi, Martin. My name is Jade. My best buy for under £5 was Winnie the Witch books that I bought from Vintage for my son who's autistic. They have given us so many laughs, so much joy. And I have to read these three books over and over again. And he is now asking for the whole set. And if I hadn't have bought those three, then we wouldn't have experienced all of those things. And so that's, it's really special to find something.

• 56:35Martin Lewis?

  That he likes so much. Oh, thank you so much for that Jade. And of course, joy from your children is absolutely priceless. That's lovely. Jade also, doesn't she have a great broadcasting voice?

• 56:44Speaker 03

  Yes.

• 56:45Martin Lewis?

  I sort of got drawn away from that the moment I heard it. I almost couldn't listen to the story because I was thinking, what delicious tones. I wish I had tones like that. Let me do another one now. Karen, I gave a wee boy £5 to buy his mum flowers last Valentine's Day. He was only about three and was insistent, but the mum said not this week. So I asked if she minded if I gave him the money. I just love that when most kids, they want sweets, but this little one wanted to get his mum something pretty. Aw.

• 57:12Speaker 03

  I've actually got one here that really resonates with me from Pinocchio Princess. I bought my second daughter a bunny rabbit for £50 for when she was being left for the first time with my parents. That bunny has gone to bed with her every night since and is now 32 years old, falling apart and looks terrible, but the best £50 I ever spent. So in their 30s, falling apart, looking terrible. I know exactly how that rabbit feels.

• 57:33Martin Lewis?

  I thought you were going to talk about your new little one and what they had as a comforter. It's amazing what they pick up as a comforter. You can never quite work out which one is going to be the one that they actually latch on to. And then once you do, how old's your?

• 57:46Speaker 03

  11 months old, yeah. So currently she's got a lot of things that are comforting.

• 57:50Martin Lewis?

  Okay, but you know the rule, as a parent of a now 11 year old, not 11 month old, whichever one she latches on to, go and buy another two or three of immediately. The number of times, we left, we left ours on a bus one time. I ran after that bus. I didn't catch that bus. It was devastating when she was about four. Oh, I could, I still have nightmares over it. Jenna, this week I discovered Caramac has been reintroduced and they have Caramac button share packs for a pound. I was devastated when Caramac was stopped, therefore I was over the moon to see these in the shops again. Maybe not what you were after, but it definitely made my life happier that day as an impulse buy. Jenna, it's exactly what I was after. And not only that, I have a similar.

• 58:31Martin Lewis?

  I remember, I'm actually just emotional just thinking about it. I remember when I was a little boy and I'd go with my mum and we'd go to, it was Boots, let's be honest. And one of my treats that I loved was the little. Rolls of Horlick's tablets that you can buy. I never liked Horlick's the drink, but I loved the tablets that you could chew. And they were discontinued for years. I looked around the world to see if I could find them because it was very evocative for me. And then last year, they've brought back Horlick's tablets. You couldn't buy them everywhere. I think it was in B and M that you could buy them. And I went and I bought about 10 packs and I still have them and I have them stored properly so that they're not going to go off. And I often just have, I don't have many of them because a lot of sugar in them. I just have one of those Horlick's tablets and it

• 59:15Martin Lewis?

  takes me back to being a little boy from a bygone time and it's quite beautiful. And they don't cost very much either. So Jenna, absolutely. If you love your caramack and it makes you happy, you enjoy it. Let's do a couple more, shall we?

• 59:27Speaker 03

  Well, yeah, well, I'll tell you what, I'll do mine because you mentioned my daughter and about 10 years ago, before I started messing about making podcasts, I used to be a teaching assistant in a special needs high school. And there's a story called The Animal Boogie that I loved reading with the kids. And then when my daughter was born, I thought, I'm going to get it. And I found it on, I think it was vintage on Facebook Marketplace, one of those sort of places for less than a fiver. And she's too young to really kind of engage with the story. But she quite likes the rhythm of the music as you sort of sing it to her. And we sort of sit there together and reading it. And it is like the most magical moments in my life.

• 59:58Martin Lewis?

  Enjoy it. They grow very quickly, as everybody my age will tell you. I'll do two more, then we'll stop. We're all getting all melancholy here. This sort of fits what we were talking a moment ago. Deb's, I lost my childhood teddy bear when I went travelling aged 19. Bereft doesn't come close. Just after I had my daughter, 12 years later, I spotted an almost identical one. Imaeus Charity Shop, Portsmouth. The happiest quid I've ever spent and something I treasure. To finish, Josephine, my husband needed a suit to attend a wedding. We were passing a charity shop and there was a suit on display in the window. It fitted in perfectly. Apparently it had been made for a gentleman and he only wore it once before passing away. The best £5 I ever spent, as he still wears it to church. I quite like that. I quite like the, the sort

• 1:00:42Martin Lewis?

  of circle of life story in there, the renewal that it was made for someone and the clothes continued to live on and it had been given to a charity shop. And then someone carries on and they wear it, wear it for life. I think there's a, there's a moral in there somewhere. I'll let you all draw your own from it.

• 1:00:59Martin Lewis?

  That's it for this special festive episode of the best bits of the pod. Don't worry, in the new year, we're fully back with proper new live podcasts with all the fiscal information you could shake a money stick at. That'll do. I'll probably have to work on my analogies as well. See you soon.

• 1:01:33Speaker 02

  Martin Lewis is the founder of moneysavingexpert.com. But of course, other consumer and price comparison websites are available. You can get in touch with Martin's podcast production team by emailing [email protected]. The offers and rates mentioned in the podcast are correct at the time of recording. However, if you are listening on demand, it's worth double checking as details can date. Remember to subscribe on BBC Sounds and leave us a review however you listen.

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