What is a mortgage broker
A mortgage broker represents individuals or companies looking to broker mortgage loans. Mortgage brokers function to find banks or lenders that will willingly make the exact loan an individual requires. Finding a good deal for a mortgage loan in Roselands will be easier if you work with a mortgage broker. Even if you have a poor credit score or any other issues that could affect your mortgage application, working with a reputable mortgage broker will still boost your chances considerably.
Because professional mortgage brokers are regulated to assure compliance with banking and financial laws in the jurisdiction of the consumer, you can be assured you’re in good hands.
What Is A Mortgage?
A mortgage is in effect a loan. A mortgage is specifically linked to a piece of property so that it acts as security against the loan, which makes it different from personal loans. Mortgage providers can rightfully take back (repossess) the property if you default on your payments.
Typically, mortgages are laid out for a set period – usually 25 years, although shorter or longer terms are also possible. A repayment plan is set up as soon as you’re granted permission to borrow the money. While there are various mortgage options, the most popular one requires a monthly capital repayment plan.
As well as paying back the money you initially borrowed (the ‘capital’), you’ll also be charged interest on that sum. A mortgage is a debt instrument, secured by the collateral of a specified property that the borrower is obliged to pay back via a predetermined set of payments. Mortgages allow individuals and businesses to purchase sizable properties, without paying the entire cost at once. Over a period of many years, the borrower repays the loan (plus interest) until they eventually own the property outright, without any mortgage. If the borrower stops paying the mortgage, the lender can repossess the property against which the mortgage is secured.
The property can be repossessed by the lender if the home buyer fails to make mortgage payments, since the bank has a charge on the house. The home’s tenants may be evicted by the bank, the property sold, and the equity used to clear the mortgage debt if there’s a repossession.
Mortgages come in many forms. Even though there are longer fixed rate mortgage terms available, the borrower would have to pay the same interest rate for the initial terms of two, three or five years. For fixed rate terms, the monthly payments remain the same throughout. If market interest rates rise, the borrower’s payment does not change on a fixed rate. If market interest rates drop or increase, the borrower’s mortgage repayment remains the same if they are on a fixed rate.
When the fixed rate is over, your mortgage return to a ‘standard variable rate’, which is usually set by the bank or lender from whom you borrow the money. The rate can increase or decrease as the lender decides, so with a good broker or diary system in place, do not forget to re-mortgage or call your existing lender, so you can adjust the rate sometime around three months before it’s increased to the variable rate. This will help you avoid paying higher monthly payments.
In fact, the initial interest rate is usually a low rate, which can make a mortgage appear less expensive than it is. If interest rates rise later on, the monthly rates may become too high for the borrower to pay. After the initial term, variable rates can be adjusted at any time, making the monthly payments unpredictable.
Other less common types of mortgages – such as interest-only mortgages, tracker rates, offset mortgages, buy to lets, bridging loans and secured loans – could also be available to you, so speak with an independent broker to determine your options. In Roselands, our mortgage brokers can assist you in finding the ideal mortgage deal to match your unique circumstances and specifications.
Handy Tools and Calculators
You can easily plan your future once you have an idea of the maximum you can borrow and how much the loan will cost. Take advantage of this handy calculator to determine exactly how much your mortgage repayments will be, based on your total loan figure and interest rate. Simply fill in the values plus your term and press ‘Click to calculate’ to immediately discover the amount you must repay monthly.
Why Use A Mortgage Broker?
Working with a mortgage broker for your mortgage application in Roselands can be beneficial in various ways. Of these advantages, some of the more prominent include:
The possibility of saving money is the most obvious advantage of working with a mortgage broker. You don’t have to handle the hard work, as this can be managed by an expert with ample experience, who will make sure your best interests are addressed. All you’ll need to do is fill out some details.
Some people are not fully convinced about this, what with the concept of a mortgage broker still vaguely understood universally. So, there has to be a catch somewhere, surely? Even though this line of thought is understandable, you can rest easy, because not working in your best interests is in no way profitable to a mortgage broker.
If the broker cannot provide genuine reasons for recommending the mortgage they have (to you, their regulators, the Financial Conduct Authority or the Prudential Regulation Authority), then they could be in serious trouble. There are various inexpensive, exclusive mortgage deals that a number of mortgage brokers can find for their clients that could possibly reduce the total loan cost. Reputable mortgage brokers communicate how they expect to be paid for their services, as well as outline the details of the entire loan. A positive user experience is more important to a mortgage advisor company than just filling the pocket of an individual broker.
Finds The Most Advantageous Deal
A mortgage broker will work towards protecting your interests, rather than those of the lending institution. They should act not only as your agent, but also as a knowledgeable consultant and problem solver. A broker can offer the best value when it comes to repayment amounts, interest rates and loan products. This is because a large variety of mortgage products are accessible to them. You’ll be required to meet with the mortgage broker to document your needs, as well as your short and long term goals. Sophisticated solutions and innovative mortgages are distinct advantages of working with experienced broker, because simple 15 or 30-year mortgages aren’t enough in some situations. These include mortgages to raise capital for debt repayment, money for your children, important home renovations or even the purchase of other properties like buy to lets.
Has Flexibility Expertise to Meet Your Needs
A mortgage broker will work with the client in any situation, as well as manage the process and take care of any bumps in the road that may occur. For example, borrowers with bad credit issues can find great products that will suit their needs through brokers who know lenders that offer such products. The knowledge and capability of a broker to successfully source financing will be of great benefit to a borrower who realises the loan they need may be too large for a bank to approve.
Save Time & Hassle
It isn’t only about money. Your time and sanity are just as important as saving some extra money. Imagine how much time it would take to find out about the numerous types of loans available from multiple lenders. You’d only need to complete one application with a mortgage broker, instead of filling out forms for every individual lender. The loans recommended can be formally compared for you buy your mortgage broker. This will serve as a guide to the information which correctly shows cost differences, with present rates, points and closing costs for each loan illustrated. Comparisons will be made by your broker between popular and less popular lenders to get you the most suitable deal, with lower rates and total cost.
Outsourcing the work to someone who can provide an expert opinion is a great way to relieve yourself of the burden involved. To be of assistance throughout the entire application and approval process, mortgage brokers do the bulk of the work. This includes handling all the paperwork, helping with applications for government ski schemes, answering questions and providing insight on other options and loan features you may not have given thought to. These features can include drawdown facilities, the option to make extra repayments and offset accounts to name a few. These types of features can make a significant difference to your mortgage cost and experience. If you don’t know much about these concepts and how they can work for you, reach out to your broker over the phone for clarification and answers.
Access to exclusive non-advertised deals
Brokers have access to exclusive deals that aren’t advertised by the banks. The deals are pushed by the banks on to the brokers, who are then charged with overseeing the sale of products. Going to the bank directly could cause you to miss out on added benefits such as these, which you can procure by speaking to a broker.
Brokers can search the whole market for the finest deal, whereas individual banks can only offer their own deals and not those of other banks.
Better chance of pre-approval success
If your request for an Agreement in principle/Decision in principle of a loan is turned down, a mark is left on your credit rating. Brokers are knowledgeable and have the much-needed experience to give you a better shot at approval the first time you apply.
Access to expert knowledge
A mortgage broker’s job is to help people obtain loans. They have access to information and select deals you wouldn’t discover by yourself. Loans are attached to subtleties you could easily overlook if you aren’t searching for them. In fact, it is these small details that can make a difference to your mortgage in the long run. It’s beneficial to have an experienced professional to point out these things for you.
You can avoid spending valuable time to research numerous loans and lenders (while perhaps missing fundamental key subtleties) and instead give the work to someone with key industry experience. A mortgage broker is a great choice for your home loan requirements, just as a plumber is for fixing a leaking pipe and a hairdresser for dealing with damaged hair.
About Mortgage Saving Experts
Mortgages and insurance aren’t as difficult as they first appear. This is why it’s very important to find honest advisers, who are knowledgeable and experienced. Making the process as straightforward and seamless as it can be is something our mortgage experts will do for you. Besides, why complicate things more than necessary? Allow us to secure the best deal possible for you and make everything straightforward.
Mortgage Saving Experts provide our clients with honest and transparent services that leave you feeling mortgages and insurance are less complicated than they first appear. At Mortgage Saving Experts, we handle every single mortgage and insurance application like they belong to us. We’re all about this. At Mortgage Saving Experts, our services are available regardless of circumstances, whether you’re a landlord, a first-time buyer, moving onto a new chapter or simply re-mortgaging. We are here to assist! Basically “Search 1000s of mortgage deals by taking 15 minutes to speak to 1 adviser.”
Our Team of Brighton Mortgage Experts
As we are bound by regulations of the Financial Conduct Authority (FCA), we must ensure we get you the best available deal on the market. We are required to justify our reasons for making the mortgage recommendations we do to both you and our regulators, so you can understand why you have the mortgage you have.
Down to Earth Mortgage
We are a team of experienced mortgage insurance experts, driven by honesty, passion and enthusiasm.
Our mortgage and insurance experts are particularly good at listening to your current and future goals. To achieve these objectives, we will then work hand in hand with you.
Why chose Mortgage Saving Experts?
For the first couple of years, you’re allowed an initial rate after taking out a mortgage. After this initial rate finishes, the rate increases to the lender’s variable rate. You will be contacted by our team approximately three months prior to the renewal time to agree a new deal, before the monthly payment and rate are increased. Other benefits of working with us include:
- The deal you’ll get is better than the bank variable rate, which in turn saves you money.
- You don’t have to keep track of the timeline, as we will look after this for you.
- We can take care of the hard work for you while you relax.
- We are good at what we do, so you’ll always be advised by professional mortgage experts.
- We compare, advise and arrange the best mortgage for you from thousands of available deals.
- You’ll receive expert advice and support throughout the entire mortgage process.
Our Approach to Mortgage Advice
The services we offer are personalised and take into account your unique needs. The approach we take to mortgage advice involves three simple steps:
- Let’s have an Initial Chat, so we can get to know You and What Your Requirements Are
- We Search the Entire Market to Find the Best Deal for You
- We’ll Present you with the Cheapest and best Deals Available for Both Mortgages and Insurance Cover
How Mortgage Saving Expert Brokers Can Help you:
What differentiates our services from those of other mortgage brokers in Roselands includes:
- Use fact-finding to properly understand your individual needs.
- Spell out the costs buying and selling involves.
- Request all documents related to the application.
- Recommend and explain the prospective mortgage.
- Proffer replies to any questions you might have.
- Obtain an agreement in principle.
- Have your entire mortgage application sent in.
- Work with your estate agent, solicitor and mortgage lender to answer any questions comprehensively.
Mortgage Types We Provide Expert Advice On
We offer expert advice on a wide variety of mortgage products. You won’t have any difficulty finding the right mortgage products to suit your needs when working with us. Mortgage types that we’re frequently asked to handle include:
First time buyers
First Time Buyers are classed by most mortgage lenders as people who have either:
- Never owned a property or
- People who have owned a property in the past, but not owned one for six months or more.
Every lender has different rules and ideas about this. There usually are no issues in being a First Time Buyer. First Time Buyers must not have owned property anywhere in the world before to be eligible for stamp duty relief for stamp duty purposes.
The mortgaging process might appear to be challenging, but this isn’t necessarily so. Buying your first home can be exciting, so if you come across a suitable broker who can handle the process for you at a fair price, do take advantage of their expertise. The purpose of using one is straightforward enough. After all, if your car broke down and you knew nothing about cars, you wouldn’t try to fix it yourself. Instead, you would take it to a mechanic. With mortgages, it is exactly the same. You can save on time, effort and even money with mortgage brokers, so you should use one. There are no charges for the initial consultation.
Buying a home
You should brush up your knowledge of mortgages if a home purchase is a viable option for you any time soon (or a few years down the line). Learn what to do before applying for a mortgage; what to watch for during the process; and how to use a mortgage after you’ve bought your home. If you can’t deal with all of that, talk to an adviser who will provide guidance accordingly.
Your credit is of great importance.
A mortgage is not to be taken lightly. Banks risk a large amount of money and have been steadily more careful since the subprime mortgage crisis in 2008. For mortgage eligibility, good credit helps, but isn’t vital. We can also guide you with regards how much you can afford to pay for your new home and what should be your price ceiling, based on your current situation. Helping you buy your dream home is not all we do; we will also help you finance it with the lowest cost and most beneficial mortgage deal available.
Re-mortgage your home
Simply put, all you’re doing with this is changing from one lender to another to get a better rate or cheaper deal. The two do not necessarily go hand in hand. Let me clarify this. It may seem unwise to pay an arrangement fee to another lender to get on a lower rate if you have a small mortgage. You may find it’s more practical to go on a slightly higher rate, without paying arrangement fees to any lender. It’s best to always talk to someone before agreeing any deal, because you don’t want one that’s more expensive overall, even though the rate might be significantly lower. Focus on any small print.
One advantage of re-mortgaging is that you won’t have to pay any valuation or solicitors fees. That said, not everyone is eligible for this exemption. This is because it is dependent on your circumstances alone at the time of re-mortgaging. So, please make enquiries with your adviser.
A mortgage deal conducted at the right time is an effective way to cut the cost of your mortgage bills significantly. While a re-mortgage deal can be beneficial for some, it’s not the best move for everyone, as it all depends on your unique circumstances.
Reasons for remortgaging your property
- Based on your unique circumstances, such as…
- Mortgage debt is relatively small.
- There have been significant changes in financial disposition.
- Early repayment charge that’s costly.
- A reduction in home value.
- You have credit issues.
- Current rate is ideal.
- We will dispense advice on the merits of pursuing a re-mortgage.
Buy to Let
A property purchased in order to be rented to tenants is a ‘buy to let’. You are not allowed to legally live in the property. The number of available lenders will be restricted if you’re a First Time Buyer, purchasing a buy to let property. Also, extra checks are made by the lender in cases like these.
- There are some things you might want to know when purchasing a buy to let property.
- The loan amount you can borrow is largely dependent on the rental income you receive.
- You will have to pay 3% stamp in addition to your normal stamp duty.
- If the property is below the value at which stamp duty becomes liable, you will still have to pay the extra 3% of the purchase price.
- TIP: If you’re looking to buy a second property, you should ask your solicitor/conveyancer to work out the amount you have to pay.
- To find the best mortgage to match your requirements, a good adviser will know which questions you need to answer.
- To find out if you qualify, contact our advisers today.
How Much Do Mortgage Brokers Charge?
A percentage of your mortgage loan is paid as commission to many mortgage brokers by lenders. Even though the figure isn’t set in stone, it is usually about 0.33%, based on the type of mortgage you require – for instance, a residential mortgage or buy to let. Also, any recent credit issues you may have had would be taken into consideration. Most independent brokers charge a flat fee, which is typically around £500. Don’t forget to find out how brokers collect payment. They must be completely transparent, telling you how much is being charged and what fee structure they use.
We have a fee structure based on charging our clients £695. From that figure, we then deduct any commission received from the mortgage lender If the commission we receive is less than £695, we then ask the client to make up the difference between what we have been paid in commission up to £695. For example, if we received a commission of £495, we would then ask you for a fee of £200 which is payable on production of your mortgage offer, so we are only paid on results.
How Much Can I Borrow?
Many factors affect this, such as how much you earn, the amount you deposit, the number of children you have, as well as any debts you might have in the background. What determines the amount a lender will agree to lend is a full affordability assessment. This will help them understand your loan or credit commitments, as well as income and everyday household expenses. For mortgage purposes, they will also perform a credit check to be sure you have an adequate credit rating.
To get an idea of the amount you can loan, get a decision in principle before applying for a mortgage in full. Arrange to see one of our qualified mortgage experts today. We can at least give you an idea, without having to do any credit checks at the initial stage.
The Latest Best Mortgage Rates
We can provide help in many different situations; for instance, re-mortgaging, first time purchase, moving home or buy to lets. We compare recent mortgage deals in large quantities to help you find just what you want.
What Our clients say About us
We have a list of clients in Roselands that is both lengthy and diverse. If you still have doubts about our ability to professionally provide the best deal in Roselands at the cheapest price, see for yourself what some of our customers have said about their experience with us. Reach out to us today for a personal experience of how effective our services are.
Latest Mortgage News
The more information you have to hand in your search for the ideal mortgage arrangement, the greater advantage you’ll have. To help you begin on the right path, find recent insightful mortgage news below.
Mortgage Regulatory Information
In the UK, most mortgages are provided by building societies, specialised mortgage lenders and banks. In total, there are roughly 200 financial institutions that provide mortgages in Britain, even though the biggest share of the market is owned by Lloyds Banking Group and Nationwide Building Society.
Even though UK banks and building societies have always been regulated closely, the FCA (formerly the Financial Services Authority) put a regulatory scheme in place for mortgages, because of the Financial Services Act 2000.
Mortgage providers are tightly regulated by the FCA, in terms of their professional conduct. There are strict rules regarding the use of unfair, misleading adverts and promotions, as well as checks to make sure the terms of any contract for financial services are fair for the consumer. Regulations were initially documented in the rules for Mortgage Conduct of Business (MCOB), but were overhauled because of the 2014 FCA Mortgage Market Review (MMR).
Regarding their financial conduct, organisations that take deposits in the UK fall under the FCA’s sister organisation’s jurisdiction, the Prudential Regulation Authority. They ensure firms have a high enough level of capital to offset their lending risks.
If there is something bothering you about your mortgage provider, talking to them about it is the first step to take. If you don’t like how the issue has been dealt with, you can take your complaint to the Financial Ombudsman Service. Some mortgages are not regulated by the Financial Conduct Authority such as moist Buy to Let mortgages and if you make a complaint about these you are unable to take these to the Financial Ombudsman Service
What To Ask Your Brighton Mortgage Broker?
This is a logical follow-up question. Again, insist on a specific reply.
And once you’ve received answers to these questions, ask if the broker would be willing to put both claims in writing. That will indicate how seriously those claims should be taken.
If a problem arises during the loan application process, you’ll want your broker to respond quickly – hence this question.
Again, demand a specific answer – “Within three hours”, say, rather than “Quickly”.
The reason for this question is so you can discover whether the broker will closely guide you through what is a complicated and stressful process – or expect you to figure it out for yourself.
Organising finance and purchasing property can be complicated and stressful, so you want to know you’re in safe hands. That’s why, before you settle on a particular broker, you should challenge the broker with this question.
Don’t let the broker get away with vague statements like “Because I’m the best” or “Because I provide great service”. Use follow-up questions to demand detail. “What specific things make you better than other brokers? What, specifically, do you do to deliver great service?”
Another important question to ask. That’s because while most brokers focus on ‘plain vanilla’ clients, others might focus on, say, sophisticated investors or borrowers with credit problems.
Hypothetically; Broker A might have done 450 vanilla loans and 50 bad-credit loans, while Broker B might have done 50 vanilla loans and 250 bad-credit loans. So if you were a borrower with credit problems, you might be better off with Broker B.
Next, probe them about their customer service standards
A great way to utilise the knowledge and experience of a broker is to get them to work out the true cost of your home loan. Based on whether you’re paying Repayment or interest only, how much of a deposit you have, the length of your loan term and the rates payable your broker will be able to obtain a mortgage illustration which will have the true cost on it. This is normally depicted by the Annual Percentage Rate (APR)
By maximising your deposit amount and minimising your loan term, you stand to significantly reduce the overall cost of your loan. However, there is much more to answering what the true cost of your home loan will be. Upfront fees such as valuation fees, conveyancing and legal fees need to be added to the total cost. Ongoing fees such as those you can incur for using a drawdown facility.
While it’s impossible to forecast the entire cost of your mortgage to the penny – and let’s not forget how life circumstances and changes can affect your ability to pay your loan too – a broker can can help clarify the big picture details. Mortgage Saving Experts can recommend any protection or insurances to protect you and your family to cover life unfortunate eventualities and our team of advisers can use this information to help you decide which loan is best for your circumstances.
The big question plaguing home buyers tends to be, ‘how much can I borrow?’ Each lender is massively different in this area so as a maximum depending on many factors. In the majority of cases, you can borrow up to around 5 times your gross annual salary but in some instances, you may borrow up to 5.5 times your gross annual income
Once you speak to us, however, we’ll be able to give you a much more accurate indication of your borrowing capacity. Brokers act as the go-between for you and the lender. Lenders will need to know your living expenses, debts, credit score and whether you have dependents. A broker can factor all these things into the right loan.
A broker can also explain home loan terms you’ll need to know, such as LTV, which is the initialism for Loan-to-Value and refers to the percentage of the total loan amount you seek to borrow as a percentage of the property purchase price or value. They can also explain things like the differences in interest rates and repayment types such as Interest Only and Repayment (Capital & Interest)
This is a good follow-up question to ask, as it will give you a better understanding of the mortgage broker’s experience.
For example, imagine two brokers joined the industry in 2013, but that Broker A had written 500 loans during that time and Broker B had written 300. In that case, even though both parties would be able to claim five years of industry experience, there would be a clear difference in hands-on experience.
This is a good place to start, because a more experienced broker will generally be more knowledgeable than a less experienced broker.
Press the broker to give you a specific answer, such as “Eighteen years” or “I’ve been a broker since 2007 and in the mortgage industry since 2001”, rather than something vague like “I’ve got a lot of experience”.