16 ways to enhance your chance of gaining a mortgage

Welcome to our helpful guide that may assist you in gaining a mortgage. It’s good to have some time from deciding you would like to take out a mortgage to applying, so you can make any changes to enhance your chances.

1.  Not all lenders will lend to you

Each lender has its own way of working and its own set of criteria it will need you to match in order to lend to you, some criteria may be obvious but some may not. If you match, then they will most likely lend to you pretty quickly. If you do not fit with it’s criteria, they will probably reject your application, you will not know either way until the lender advises you.

If you are in the middle, so not the perfect fit and not a rejection it’s a bit of a grey area. And this is where the lender will score you against it’s personal scorecard (this is a “behind the scenes” list of questions it scores you against) some of the lender’s scorecard questions/benchmarks will be:

  • The size of mortgage you want
    • How much you have as a deposit
    • Your employment status and your income
    • Your credit rating
    • Your outgoings and where you spend your money (i.e. essential or non essential, committed or not etc)
    • Your existing debt

If you meet the scorecard criteria, it means it is more likely to lend to you, but it’s not guaranteed.

Working with a whole of market broker, like us, can enhance your chances of gaining a mortgage as they will check the criteria of each lender against your circumstances and advise you of anything further you need to do.

Working with a broker can save you time, effort and potential damage to your credit score, as they “get to know you” understanding your circumstances and financial position means they will know which lender is suited to your circumstances. Matching your criteria to that of the lender before any credit checks are completed. With all this in mind it’s a good idea to work with a reputable whole of market broker and understand your financial position.

2.  Check your credit report before the lender does

Lenders main interest is that you have the financial ability and payment history to pay back your mortgage. One way the key ways they will investigate this is by searching your credit report(s) to understand your credit history and how good you are at paying your credit agreements on time etc.

If you do not understand your credit history you should access your file as soon as you can through one of the 3 main credit reference agencies; Experien, Equifax or TransUnion (Credit Karma). Your credit report lists in detail for up to 6 years from the end of any agreement, your past or present, all credit agreements including credit cards, loans, overdrafts, mortgages, mobile phone and some utility payments.

Post GDPR in May 2018 you no longer have to pay for your credit report. Lenders use different credit reference agencies, so you won’t know which they will check, so it’s worth checking all of them and making sure they all reflect accuracy.

3.  Correct credit score errors urgently

If your credit file information is wrong, you have a right to address it, either having the error corrected or, at the very least, having your say by adding a note to the file explaining any issues.

You should check if the error on your credit file is held with the other agencies too, then talking to the lender/the company the credit agreement is with. If this doesn’t work and you feel you are not getting anywhere, the Financial Ombudsman could step in and order corrections (free of charge). Take their advice and follow their recommendations

4.  Register to vote

Many people don’t realise that if they are not on the electoral role at their address, they have little chance of getting a mortgage, this is literally a dealbreaker. While you can have a perfect credit score and be the best customer, without being on the electoral roll, it is still near on impossible to get a mortgage without it. Lenders use electoral roll data in identity checks (to ensure you are who you say you are, and live where you say you live and that you’re not laundering money). When you check your credit file it will say if you’re on the electoral roll or not, but you can always check with your local council. Do this as quickly as you can it can take a month or longer to add you.

If you’re not on it, you can register on the electoral roll free of charge. If you’re not a UK or EU national and can’t get on the electoral roll to vote, then you can apply to put on a notice of correction to your file, saying you have other proofs of address and ID you can offer lenders (assuming that you do).

5.  Your ex’s score can cause you problems

If you can see that you are still linked to an ex partner, write to the credit agencies and ask for a notice of ‘disassociation’ as soon as possible. If you’re financially linked to someone else i.e. joint credit/accounts but you’re now separated or no longer associated and they have any bad credit this can reflect badly on you.

Also beware as you could also still be linked to old flatmates if you had a joint bank account for bills, so it’s worth checking that their credit history isn’t affecting yours. If it is, ask for a notice of disassociation as soon as possible.

6.  Manage your available credit with future lending in mind

This is all about how much credit you have available, it’s the difference between your combined debit balances on your cards and bank accounts and your combined credit limits/overdraft limit. The credit agency Experian says that if you have debts, lenders prefer that they make up less than half your available credit. So, for instance if you have a combined credit limit of £10,000, they’d prefer that you use less than £5,000 of it. If you are getting too close to your available credit limits, it can seem that you’re at the capacity of your finances.

Try not to suddenly lower your credit limits if you are using a good proportion of your available credit, similarly, don’t have tens of thousands of pounds of available credit just because you can, new lenders rightly get nervous that you could use all your available credit suddenly and become more indebted. It’s a fine balance and lenders differ on their tolerances for debt, we suggest you try and stay below 50%, if you cannot pay off your debt.

7.  Close inactive accounts

It’s maybe worth closing old inactive accounts and it’s not only a potential fraud risk it could also need updating. Having said that if you’re applying for a mortgage, lender favour longer, stable credit relationships, so, if you’ve two bank accounts, one recently opened and one you’ve had for years, it’s probably not worth closing the older one before you put in your mortgage application as you could lose the boost this gives you in your credit score.

8.  Pay your bills on time, every time

If you have seen your credit file you will see each lender/creditor updates your file monthly, so every time you miss a payment your credit file shows a missed payment and by how many months.

All missed payments are a negative against you on your credit file, so it’s vital to keep up all repayments on ALL your outgoings.

Defaults count against you for at least a year, and they’ll stay on your file for the next six years. Miss just one credit card payment and it could be the difference between getting a mortgage and not.

Here is an example of a lenders criteria for credit (June 2020)

No current adverse credit allowed.

  • Missed mortgage payments – no more than two occurrences within the last 24 months
  • Unsecured arrears – no more than two occurrences within the last 24 months
  • CCJs and Defaults – Must be settled
    • 1 – 12 months – £250 total
    • 13 – 24 months – £500 total
  • IVAs/Debt Management Plans – Must be settled for three years
  • Bankruptcies – Must be discharged over 5 years ago

Applicants must not have credit score lower than 600, we use Experian as our credit referencing agency.

9.  Don’t apply for credit before a mortgage

If you apply for credit in the three months before you apply for your mortgage it could hinder your score and ability to be accepted. We recommend at least a six-month gap, to be safe. This is because all lenders search your credit file every time you apply for any form or credit or credit agreement. The search leaves a footprint (so others lenders/creditors can see you have applied) on your file, even if you do not proceed with the credit.

You should note however if you have had or applied for a payday loan, some lenders will decline you for a mortgage if you’ve had one in the past year.

10.             Cut back on spending before applying

Lenders will ask for a full affordability assessment about your outgoings, commitments, and dependants etc before they make any decisions. They will more often than not want to see 3 to 6 months bank statements and pay slips to verify what you’ve told them. This is because new rules brought in in April 2014 mean the lender must ‘stress test’ you to see if you have financial capacity to pay your mortgage, should interest rates rise for instance.

A lender will always examine your spending habits so it’s worth tightening your belt in the months before you apply and cut out as much non-essential spending to maximise your chances of being accepted.

It’s also a good idea to plan for the expense of moving and potentially stamp duty.

11.             Stay out of your overdraft

If you’re constantly using your overdraft, this could be seen as a negative by the lender as you are living close to the edge of your finances, so avoid it if possible. Some lenders won’t tolerate you using your overdraft at all during the mortgage process.

12.             If you are renting this can boost your credit score

If you pay your rent on time every time, there’s a free scheme which millions of private renters and those in social housing can use to build their credit history and boost their rating.

It was launched in March 2016 by Experian and The Big Issue Group. You can  opt in to the Rental Exchange Initiative which means your rental payment information is recorded in your Experian credit file and lenders can see you have consistently paid your rent on time.

13.             Borderline deposit?

If you are on the borderline of minimum deposit required putting down a little bit more than the minimum required can boost your potential to the lender, or at the very least cut the amount of documentation it wants to see.

For example, instead of applying for a £100,000 mortgage on a £150,000 property (where the loan is 75% of the property value), apply for £112,250 rather than £112,500, if you can afford the extra £250 deposit.

All mortgages have a maximum loan-to-value (the amount you borrow compared to what the property’s worth) but it’s best to borrow just under this if you can.

14.             Sort your paperwork to speed things up

Sending all the paperwork in one batch speeds up the process and helps your broker or lender. It also reduces the chances of your application being reviewed by more people.

Some lenders won’t accept printed internet bank statements for example however your broker will advise you of this or your lender. So, it’s best to have your bank send you originals, ask for these a few weeks in advance in case you need to wait for them to arrive.

Your broker may want to see any or all of:

  • Proof of deposits (eg, savings account statements)
    • ID documents (usually a passport)
    • Proof of address (eg, utility bills or credit card bills)
    • Your last four to six months’ bank statements
    • Your last three to six months’ payslips
    • Proof of bonuses/commission
    • Your latest P60 tax form (showing income and tax paid from each tax year)
    • Your last three years’ accounts or tax returns
  • A gift letter. If you’re getting deposit help, the lender needs to know it is a gift (not a loan), and that the giver won’t in any way own any of the house.

15.             Test drive your mortgage chances

Once you’ve done all the steps above, your finances should be in great shape. To test this, a mortgage agreement in principle (AIP), offered by many lenders, is the acid test, which is where your broker will come in to their own. Your broker will match your criteria and go for a conditional offer saying you may be accepted, based on a quick check of your income and, probably, your credit file. Although it offers no guarantees and it’s not compulsory, if your broker is worth their fee, like us, they will have matched you correctly and with experience will be pretty confident of your acceptance.

If you decide not to use a broker, just beware – too many of these checks in a short space of time could harm your credit rating if the lender does a credit check and marks it on your file, which they often leave a soft footprint. This could damage your mortgage application later.

16.             Halt and take stock if you are rejected

If you’re rejected your broker will advise you’re not to apply again with a different lender right away. Too many applications can negatively impact your credit score. Your broker will generally be able to advise why the application was rejected so you can rectify any issues (apart from your credit file you will need to look at this, unless you have shared this with your broker in which case they will have highlighted any potential issues upfront). If you are not working with a broker, then check your credit file again. Maybe you have missed something?

At all costs, if you are not working with a broker like us avoid the rejection spiral which works like this:

  • You apply
    • You get rejected (sometimes falsely, it could be due to an error you are not aware of)
    • You apply with another lender
    • You get rejected again

We have seen this continue through 7 lenders before…. until finally you check your credit file and get the error corrected. So then:

  • You apply again
    • You’re rejected because of too many recent ‘searches’ which highlights the fact you have been rejected and it goes on

If you’re rejected once and you are not working with a broker then immediately go to the top of this guide and follow the steps we’ve set out, or you may create serious issues with your credit score as more applications mean more searches, which will compound the problem.

If you haven’t missed anything and your credit file’s still looking good, it could just be that the lender you applied to had its own reason for turning you down and as you don’t know which lender has which criteria, It’s worth asking the lender why and working with a broker like us.

Good luck

As experienced whole of market mortgage and protection brokers, If you would like any assistance with gaining your mortgage, please get in touch on 01423 561060 or email


Shared ownership information sheet

Welcome to our helpful guide on shared ownership housing. If you would like to understand how to enhance your changes of gaining a mortgage for your shared ownership property see that may assist you in gaining a mortgage. It’s good to have some time from deciding you would like to take out a mortgage to applying, so you can make any changes to enhance your chances.

How shared ownership works

With shared ownership, you buy between a quarter and three-quarters of a property. You have the option to buy a bigger share in the property at a later date. These schemes are aimed at people who don’t earn enough to buy a home outright. Up to 75% ownership you will have to pay rent to the housing association.

Most of the homes available are newly built, but some are properties being re-sold by housing associations. All shared ownership homes in England are offered on a leasehold only basis, which is not a problem as long as the lease has a long time still left to run.

Who can apply for Shared Ownership?

The criteria for who’s eligible for the shared ownership in England:

First-time buyers or those who used to own a home but can’t afford one now

People whose combined household income is less than £80,000 (in London, it’s less than £90,000)

You rent a council or housing association property.

You don’t have to be a key worker, such as a nurse or teacher, to apply for shared ownership.

Military personnel will be given priority over other applicants.

Once you own 75%, you won’t have to pay rent on the remaining share.

If you have a long-term disability and cannot find a suitable home for your needs, you can get help with the ‘Home Ownership for People with long-term Disabilities (HOLD)’ scheme.

Stamp Duty and shared ownership

In the 2018 Budget, the government announced that first-time buyers would be exempt from paying stamp duty if their shared ownership property is worth up to £500,000 – and this is back-dated to 22 November, 2017. This means that any first-time buyers that have paid stamp duty on an eligible shared ownership property after 22 November, 2017, can apply for a refund.

How to claim a stamp duty refund

If you’re eligible for a stamp duty refund, you need to contact HMRC in writing. Make sure you do this by the deadline of October 28, 2019. In your letter, you should provide details of your purchase and share the UTRN, which is the unique reference number on the original stamp duty return.

What are the downsides to shared ownership?

1. Maintenance charges

Hopefully the monthly mortgage repayments, plus rent will still make shared ownership far cheaper than buying a property outright. But don’t forget to add on maintenance charges and be prepared for possible increases in the future. As well as a general monthly service charge for caretaking and maintenance of communal areas. Make sure you ask how you will be expected to pay for more significant works e.g. for structural issues or roof maintenance.

Be aware that even though you own a share of the property, say 30%, you are responsible for paying the full maintenance and repair costs.

2. Renting is generally not allowed

There are also likely to be restrictions on whether you can rent the property out. In the great majority of cases, sub-letting is not allowed.

3. Buying up increased shares in your property can be expensive

Once you have purchased your stake in the house and you wish to increase your stake at a later date or “staircase” – it’s not just buying the share you need to think about. There are other costs you need to consider:

Valuation fee – your housing provider will instruct a surveyor to confirm the current market value of the property and this will include a valuation fee.

Legal expenses – staircasing will involve changes to your existing lease which will require a solicitor to complete.

Stamp duty – if you’re not eligible for first-time buyers relief, and the stamp duty holiday is finished (March 2021) there are two ways to pay.

The first involves one-off payment in advance based on market value of the property and the second is by paying in stages. You will need to calculate the best option for you.

Mortgage fees – If you are applying to change lenders to buy your additional share or to access better interest rates you will need to pay the lenders valuation fee and a mortgage arrangement fee, plus any penalty your existing lender may charge for terminating your mortgage with them. However working with Stuart James Financial Solutions we will help you manage fees and advise to avoid early termination, where possible.

Check with your housing provider whether there are any restrictions when it comes to buying up a greater share in your property e.g. What is the upper limit you can staircase to? Can you start staircasing immediately? What are the maximum number of times you can staircase? What’s the minimum share you can buy at any one time?

4. Restrictions on what you can do

Check for restrictions within your lease. You are likely to be required to ask the housing provider’s permission in writing before you make any structural alterations to your home. In some cases the lease will require you to ask permission for redecorating as well.

5. The risk of negative equity

Buying a new build property – whether through shared ownership or on the open market – is more likely to make sense if you expect to stay put for a number of years. This is because new-build properties include an extra premium on the sale price that, like a new car, depreciates as soon as you move in. If house prices fall, you may fall into negative equity and lose money if you try to move.

To avoid the risk of feeling trapped in the event of negative equity, be honest about the properties you are looking at. Is there enough storage? Are you expecting to start a family in the next few years? Is the garden big enough for your family now and future? Is it in the right neighbourhood for the schools you want?

6. Issues around selling your share when moving home

When you are ready to sell your home, the process is can be a little complicated and can stall your progress on to the next rung of the property ladder. First of all, the housing provider is likely to have the right to buy back the property before it is marketed to anyone else (this is called “right of first refusal”), even in some cases if you have purchased 100% of the property through staircasing. This is so your property can be put to other people on the waiting list who are unable to buy on the open market.

After a period of time, if your housing provider fails to find a buyer you are free to market your share of the property yourself or using an estate agent. But you will need to find a buyer who fulfils the housing providers eligibility criteria for shared ownership. As not all banks provide shared ownership friendly mortgages, your pool of potential buyers may be reduced. However we can help with this.

7. You don’t have greater protection under shared ownership

Just because this is a government backed scheme doesn’t mean you get any more protection.

Costs can spiral. Check you can afford increased maintenance charges. While rents start low, expect these to increase, it is your responsibility to keep up repayments on your mortgage loan. Be aware that as rent is paid on the part of the property not owned by you, the housing provider can take action to repossess the property for rent arrears in the County Court.

What should I do before I apply?

If you find a property you like, research the housing provider on-line. See what customers say on forums. Are they satisfied? How well are they maintaining the property and at what cost? How well do they treat their customers?

Check the eligibility criteria of that specific housing provider for the property you like read and understand your lease and what restrictions it sets out, price up the various costs, work out your monthly payments.

Think about your long-term plans and when you could afford to start staircasing

Check out our other unbiased guides on buying, selling and running your home. Talk to us so we can help secure the home you want and the mortgage you need. Read our guide on 16 ways to enhance your changes of getting a mortgage.

What’s the application process?

Speak to the Housing team in your local council, or housing association, to see whether you’re eligible to apply.

You don’t have to live in a council owned home to be eligible. Look on the Share to Buy website to see what properties are available in England, or Homes for Londoners if you live in London.

Not all lenders will lend to you for shared ownership but we have access lenders who do. We will apply for a mortgage for you to pay for your share but you will have to undergo strict affordability checks, criteria checks and a credit reference search by the lender. You will also be expected to be able to provide a deposit of at least 5% but 10% is better (July 2020).

Make sure you will be able to afford all the costs of home ownership; including mortgage fees, moving costs, stamp duty, insurance, repairs, maintenance and, if it’s a flat in a block, your service charge.

You can use us for your mortgage for shared ownership and we will walk you through the whole process

Good luck

As experienced whole of market mortgage and protection brokers, If you would like any assistance with gaining your mortgage, please get in touch on 01423 561060 or email


Do you know the different types of mortgages available to you?

There are many different types of mortgage and thus when you are choosing a new mortgage, don’t just look at interest rates and fees, but consider if the mortgage is the right one for your specific needs.

Our team get to know you and put you at ease right away, you are safe in the knowledge we are the experts and we will walk you through the whole process. We help to determine what you need, then  match your criteria to the lenders. At this point we consider the different types of mortgages available to meet your needs, along with the advantages and best rates available, making sure we get the best deal available on the market to you.

The best rate available to you GUARANTEED.

Types of mortgages?

  • Fixed rate mortgages
  • Variable rate mortgages
  • Standard variable rate (SVR)
  • Discount mortgages
  • Tracker mortgages
  • Capped rate mortgages
  • Offset mortgages

So, there are many different mortgages and it’s our job to determine the right one for you. Most people have heard of fixed rate and variable rate mortgages but sometimes these are not the best option to meet your needs. A fixed rate mortgage is a mortgage where the interest you’re charged stays the same for a number of years, typically between two to five years, whereas a variable rate sees the interest fluctuate based on the Bank of England Rate. If you want peace of mind that you know what your monthly payment will be for the term of deal, then fixed rate is a great option.

Fixed rate mortgages

The interest rate for fixed rate mortgages stays the same throughout the length of the deal no matter what happens to interest rates. These are usual advertised as two-year or five-year fixed. A mortgage like this is great for budgetary purposes however they are usually slightly higher in interest rates and if interest rates fall you won’t benefit.

A Variable rate mortgage is less stable and rates can change at any time and can, if interest rates rise, leave you scrambling around for additional monthly cash to afford the premiums. Conversely, throughout the term if rates fall, you can save yourself money.

Other types of mortgages include:

Discount mortgages

This is a discount from the lender’s standard variable rate (SVR) and only applies for a certain length of time, typically two to five years.


Two banks have discount rates:

Bank A has a 2% discount off a SVR of 6% (so you’ll pay 4%)

Bank B has a 1.5% discount off a SVR of 5% (so you’ll pay 3.5%)

Though the discount is larger for Bank A, Bank B will be the cheaper option.

This could be good as rates can be lower but can again play havoc on your ability to budget.

Tracker mortgages

Tracker mortgages move directly in line with another interest rate – normally the Bank of England’s base rate plus a few percent.

So if the base rate goes up by 0.5%, your rate will go up by the same amount.

Usually they have a short life, typically two to five years, though some lenders offer trackers which last for the life of your mortgage or until you switch to another deal.

Capped rate mortgages

Your rate moves in line normally with the lender’s SVR. But the cap means the rate can’t rise above a certain level. It provides certainty as long as you can pay the very top rate mortgage amount per month but beware the cap tends to be high.

Offset mortgages

This type of mortgage links your savings and current account to your mortgage so that you only pay interest on the difference. Each month you still repay your mortgage but your savings act as an overpayment which helps to clear your mortgage early.

If you are looking to discuss mortgage options and would like professional help, please get in touch using the contact form on our website.


Relevant Life Insurance – Awareness

Relevant Life Cover is a life insurance policy offered by the company your work for. It allows companies to offer a death-in-service benefit to its employees (including salaried directors). It’s set up by the company and pays out a tax-free, lump sum on the death (or diagnosis of a terminal illness) of the person insured.

It can help smaller businesses attract and retain high-calibre staff by offering them attractive benefits packages that are also tax efficient. It can also be a tax-efficient way for shareholder directors to take out life insurance.

Tax benefits

There can be tax benefits for both the employer and employee.

Employer benefits:

  • corporation tax relief (so long as the premiums are wholly and exclusively for the purposes of the business); and
  • no National Insurance contributions to pay on the policy payments paid to fund the Relevant Life policy.

Employee benefits:

  • no National Insurance contributions to pay on the policy payments paid to fund the Relevant Life policy;
  • the policy payments won’t be taxed as a benefit in kind; and
  • policy payments and benefits don’t count towards annual or lifetime pension allowances.

With great benefits, this policy offers peace of mind for both the employer and employee so it’s surprising that awareness of Relevant Life Plans (RLPs) has reduced by 24% in the last two years, with only 28% of businesses being aware of such policies in 2015, according to Legal & General.

The insurer’s research, which surveyed nearly 850 business owners across various industries, showed that awareness was higher two years previous, with 37% of owners in 2013 knowing about RLPs. The research also found that those businesses least likely to have heard of RLPs were not for profits, small businesses and those in the property/real estate and education sectors.

Richard Kateley, head of specialist protection at Legal & General, said: “Relevant Life Plans are policies which many employees would like to be offered by their company, if only they knew about them. However our research shows that few know they exist and therefore are unaware of the benefits they could offer. Our research actually shows that there has been a reduction in this awareness among business owners over the last few years.

All businesses should consider relevant life insurance for their staff and Directors, it is a great way to attract and keep good staff and is a tax efficient way of offering benefits for such important insurance protection.

For further information on relevant life insurance, please contact Stuart James Financial Solutions on 01423 561060 or email

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    Are you confused about protection insurance?

    In a state

    Consumers need help to better understand the benefits of taking out protection products according to State of the Protection Nation a new study released today from Royal London. The research finds that many barriers to buying protection products are due to perception and can be overcome with better education. The study of 2,000 people found that while a quarter of UK adults have a life insurance policy (26%), just 6% have critical illness cover and 4% have income protection insurance.

    For each product, the same barrier is top, price – with nearly one in three who don’t have life insurance, critical illness cover or income protection saying they think the products are too expensive (29%, 32% and 31% respectively). Analysis of premiums Royal London customers pay reveals the average life insurance premium is £21.28 per month for over £120,000 of cover and the average critical illness cover premium is £30.58 per month for over £71,500 of cover.

    The second most common barrier was people not seeing the benefit of the product. Yet almost two fifths (38%) say it is important to ensure that their family and dependents are looked after financially should they die and half (47%) agree that life insurance is essential for anyone with a mortgage or dependents. This shows that with better education, from the industry and advisers, more people could be better protected.

    The third barrier is not trusting insurance companies to pay out in event of the claim. Yet the most recent industry figures show insurers pay out in 97.2% of all claims.

    The research reveals that more people see a need for the products than actually have them, suggesting that with greater action on the barriers the UK could be better protected. While one in 10 (9%) say they see the need for income protection just 4% hold it and while 12% say they see the need for critical illness cover, just 6% hold it. For life insurance, however, take up matches perceived need, where 27% see the need and 26% hold it. Those with children under 18 are much more likely to believe that all three types of product are needed, in particular critical illness cover (21% compared to 9% who don’t have children).

    Royal London also found more work needs to be done to help people understand what could happen to them during their working life. According to the research, respondents were more likely to think they will die (22%) within their working life than be made redundant (15%), contract a serious health condition or illness (15%), go on sick leave for three months or more (11%) or have an accident preventing work (9%). Yet a quarter (25%) of those polled had been made redundant or lost their job at some point, whilst one in seven (15%) have been off sick for three months or more or been diagnosed with a serious health condition or illness.

    To find out more or to gain financial advice contact us on 01423 561060 or email

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