What is a mortgage broker
To broker a mortgage loan, a mortgage broker will act as a link on behalf of an individual or business. The job of a mortgage broker is to identify banks or direct lenders that would make the actual loan an individual seeks. You’ll have a stress-free time getting a great deal on the mortgage you need in South-Woodham-Ferrers if you work with a mortgage broker. Even with complicated circumstances or a poor credit score, the ideal mortgage broker will boost your chances of getting a mortgage.
Professional mortgage brokers are bound under strict regulations and required to comply with banking and finance laws in the customer’s jurisdiction, so, you don’t have to worry about being in the wrong hands.
What Is A Mortgage?
In simple terms, a mortgage is a loan. Unlike personal loans, a mortgage is specifically tied to a piece of property, so that it acts as security against the loan. Mortgage providers can rightfully take back (repossess) the property if you default on your payments.
Mortgages are nearly always set for a 25-year period, but long and short terms are also available. Once you’ve borrowed the money, a repayment plan is then set in place. Mortgages with monthly capital repayment structures are the most common, even though there are other options available.
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 time, the loan and interest included can be repaid by the borrower, before the property can become theirs without any mortgage. If the borrower defaults in making mortgage payments, the property on which the mortgage is secured can be repossessed by the lender.
Should there be a default on mortgage payments, the lender can take back the property, as the bank will have a charge on it. In the case of a repossession, the bank may evict the home’s tenants and sell the house, using the income from the sale to clear the mortgage debt.
Mortgages come in many forms. While there are longer fixed rate terms provided, the borrower will pay the same interest for the initial term; that is, two, three or five years, with a fixed rate mortgage. For fixed rate terms, the monthly payments remain the same throughout. The borrower would continue with the same payments if they have a fixed rate, even if the market interest rates go up. The borrower’s mortgage repayments do not change if the market interest rates rise or fall if they have a fixed rate.
Your mortgage will usually revert to a ‘standard variable rate’ laid down by the bank, building society or lender that lends you the money, once the fixed rate ends. This rate can go up or down whenever the lender sees fit, so if you have a diligent broker or good diary system in place, remember to re-mortgage or call your existing lender and change the rate by looking around three months before that rate increases to the variable rate. This will save you paying much higher monthly payments.
In short, the initial interest rate is often a low rate, which can make a mortgage seem more affordable than it really is. Higher monthly payments may be hard to meet for the borrower if interest rates are increased later. Monthly payments after the initial term are usually unpredictable, since the variable rates could be changed at any time.
Talk to an independent broker about other types of mortgages that could be options for you, such as buy to lets, interest-only mortgages, secured loans, bridging loans, offset mortgages and tracker rates, which are not so common. You can receive assistance from our mortgage brokers in South-Woodham-Ferrers to find a mortgage deal that best matches your individual specifications and circumstances.
Handy Tools and Calculators
Being aware of what you can borrow and the amount the loan will cost will make it simpler to plan your future. 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. To immediately determine how much you’ll have to repay each month, simply enter the values and your term before pressing ‘Click to calculate’.
Why Use A Mortgage Broker?
Working with a mortgage broker for your mortgage application in South-Woodham-Ferrers can be beneficial in various ways. Of these advantages, some of the more prominent include:
Of all the benefits working with a mortgage broker provides, the possibility of cutting costs would be the most obvious. You only need to provide a few details, before an experienced professional committed to protecting your interests handles the hard work.
Some people are sceptical about this – especially with the concept of a mortgage broker not yet universally understood. There must be a catch somewhere, surely? Although such reservations are not entirely invalid, you should be aware that there is no benefit for mortgage brokers who do not work in your best interests.
In fact, a broker could be in serious trouble if they are unable to prove to you, their regulators, the Financial Conduct Authority or the Prudential Regulation Authority why they’ve recommended the particular mortgage that they have. Exclusive mortgage deals not found on the high street can be unearthed by many mortgage brokers, which could potentially cut the cost of the entire loan for the client. Detailing the entire cost of the loan and letting you know how they get paid for their services is the duty of any reputable broker. A mortgage advisor company values ensuring a positive experience for their customers over padding the pocket of a broker.
Finds The Most Advantageous Deal
A mortgage broker represents your interests, rather than those of a 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. Mortgage brokers will interview you to identify your needs, as well as 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
Any problems that may arise can be dealt with by a mortgage broker, who will oversee the whole process, guiding the client through any situation along the way. For instance, a broker will have knowledge of the lenders who offer the best products to meet the needs of a client with a credit issue. 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 a bit of extra cash. Take into consideration the time you would need to research different kinds of loans from multiple lenders. You would only have to fill out one application form, instead of one for every lender you have to work with. Your mortgage broker can make available a formal comparison of the loans recommended to advise on the information which completely illustrates cost differences, along with present rates, points and closing costs for every loan shown. Your broker will set deals from major and less popular lenders side by side in order to discover an agreeable deal, with rates and total costs that are lower.
Take some of the work off your shoulders and outsource it to someone who can offer expert advice. Mortgage brokers do the legwork for you by supporting you throughout the application and pre-approval process. This includes completing all paperwork, answering questions, helping you apply for government schemes and shedding light on options and loan features you may not have considered or even known about. Drawdown facilities, offset accounts and extra repayments (to name a few) are just some of the features involved. Your general mortgage experience and overall expenses can be largely affected by these features. In fact, if you don’t know so much about these concepts and the effects they could have, you can find clarification and get answers to any questions you may have during a phone call.
Access to exclusive non-advertised deals
There are exclusive deals that aren’t advertised by banks to which brokers have access. The banks push these deals on to brokers, who are in charge of selling the 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.
Unlike brokers who have access to the whole market to search for the best deals, banks can offer their own deals alone – and not the deals offered by 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. The experience and knowledge required for your best chance of approval the first time you apply is something brokers have in abundance.
Access to expert knowledge
A mortgage broker’s job is to help people obtain loans. They can access useful information and exclusive deals you likely couldn’t find yourself. If you aren’t looking for them, you’re likely to miss the subtle details that come with loans. At the end of the day, these subtleties tend to improve your mortgage chances. Having the services of an experienced professional who can point these out for you is a huge benefit.
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. Just like you’d acquire the services of a hairdresser to replenish damaged hair or a plumber for leaking pipes, a mortgage broker is an excellent option for any of your home loan needs.
About Mortgage Saving Experts
Mortgages and insurance are not as complex as they seem at first. That’s why finding honest advisers with invaluable experience and knowledge is so important. Your entire journey can be made stress-free and simple by our mortgage savings experts. After all, why make things more difficult than they need to be? Allow us to ease the entire process and obtain the best deals available for you.
With the honest and transparent services customers receive at Mortgage Saving Experts, they will come to realise that mortgages and insurance are not as challenging as they seem. At Mortgage Saving Experts, we treat each mortgage and insurance application as if it were our own. This is what we’re all about. 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 provide assistance! Fundamentally “Find out about 1000s of mortgage deals by putting 15 minutes aside to talk to 1 adviser.”
Our Team of Brighton Mortgage Experts
We make sure we help you get the best available deal the market can offer, as we are regulated by the Financial Conduct Authority (FCA). We need to provide justification to our customers and regulators for recommending the mortgages we do, so you understand just why you have that particular mortgage.
Down to Earth Mortgage
We are an honest, passionate, enthusiastic and very experienced team of mortgage and insurance experts.
Our mortgage and insurance experts pride themselves on listening to what your current and future objectives are. We will then work together with you to reach these goals.
Why chose Mortgage Saving Experts?
For the first few years after taking out a mortgage, you’ll be subject to an initial rate. After the initial rate period, the rate is then raised to the lender’s variable rate. Three months before this rate is up for renewal, our team will contact you again to put a new deal in place before your rate and monthly payments increase. 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 remember when your deal finishes, as we will do this for you.
- We can take care of the hard work for you while you relax.
- This is our area of expertise; you’ll always receive advice from a qualified mortgage expert.
- We compare, advise and arrange the best mortgage for you from thousands of available deals.
- For the entire mortgage process, you will be expertly advised and supported.
Our Approach to Mortgage Advice
We provide personalised services and pay attention to all your specific needs. We approach mortgage advice using three basic 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:
The reasons our services are better than those of other mortgage services in South-Woodham-Ferrers include:
- Find out what your needs and circumstances are through fact-finding.
- Point out the costs that come with buying and selling.
- Request applicable documents to aid the application.
- Make relevant suggestions and provide explanations about the prospective mortgage.
- Proffer replies to any questions you might have.
- Obtain an agreement in principle.
- Get your whole mortgage application submitted.
- Communicate with your solicitor, mortgage lender and estate agent to respond to any questions through to completion.
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. Amongst the mortgage types we’re commonly asked to handle are:
First time buyers
Most mortgage lenders Categorise First Time Buyers 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. Normally, being a First Time Buyer is no issue. To qualify for stamp duty relief as First Time Buyers, you must have never owned a property before, anywhere in the world.
Mortgages may appear to be a rather difficult process, but they really don’t have to be. Buying your first home is one of the most exciting things ever, so if you find a reasonably priced, reputable broker to manage the process for you, do hire their services. Why you should use one is pretty obvious. Besides, if your car breaks down and you have no knowledge of cars, you wouldn’t attempt to fix it yourself; you would use the services of a mechanic. With mortgages, it is exactly the same. Mortgage brokers can help you save money, time and effort, so why don’t you use one? The initial consultation is free of charge.
Buying a home
If you’re thinking of a home purchase any time soon – or even within a couple of years – you should familiarise yourself with everything involved with mortgages. Study what you should do before the application, during the process of application, and how to utilise the mortgage after buying your property. 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 serious issue. Banks risk a large amount of money and have been steadily more careful since the subprime mortgage crisis in 2008. Good credit helps to qualify for a mortgage, but it isn’t a necessity. 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
In short, this means you’ll switch from one lender to another to get a more affordable rate or cheaper deal. They don’t necessarily have to be paired together. Let me explain. 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 might find it cheaper by going on a slightly higher rate and paying no arrangement fee to the lender at all. 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. Take extra caution.
One benefit of re-mortgaging is that you’ll not normally pay for any valuation or solicitors fees, although not everyone qualifies for this. This is because only your circumstances are considered at the time of re-mortgaging. So, please ask your adviser about it.
Performing a re-mortgage in time is a practical way to reduce your mortgage costs significantly. Although it can be a good thing – depending on your individual needs – a re-mortgage deal might not be the most suitable choice.
Reasons for remortgaging your property
- Based on your specific needs, such as…
- Mortgage debt is considerably small.
- There has been a change in financial circumstances.
- Early repayment charge is on the high side.
- Decrease in home value.
- You’re dealing with credit problems.
- Present rate is very agreeable.
- We will provide guidance to help you choose whether to re-mortgage.
Buy to Let
‘Buy to let’ properties are those you wish to purchase and then rent to tenants. You are not allowed to legally live in the property. You can purchase a buy to let property as a First Time Buyer, but you’ll be restricted to the number of available lenders, while extra checks will be made by the lender in such situations.
- When purchasing a buy to let property, there are a few things you’ll need to know.
- 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.
- You’ll still have to pay the extra 3% of the purchase price, even if the property isn’t valued as it should be for the stamp duty to be liable.
- TIP: Ask your solicitor/conveyancer to work out how much you’ll have to pay if you’re buying a second property.
- A good adviser will know the exact questions to pose and will find a mortgage that fits your exact requirements.
- Get in touch with our advisers to find out if you qualify.
How Much Do Mortgage Brokers Charge?
A percentage of your mortgage loan is paid as commission to many mortgage brokers by lenders. This is usually around 0.33%, although this does vary massively, depending on what mortgage you require. For example, this would take into account buy to let or residential mortgages and whether you’ve had any credit problems in the recent past. A flat fee of roughly £500 is usually charged by the majority of independent brokers. Be sure to ask brokers how you can pay them. They should be honest and up front, telling you the amount owed and the fee structure they have in place.
Our fee structure is based upon charging the client £695; any commission which is received from the mortgage lender is deducted from that figure If we receive a commission below the value of £695, we ask the client to pay the difference between the received commission and £695. If we receive a mortgage commission of £495, our client would be required to pay £200, which would be paid after the mortgage offer has been forthcoming, meaning we only get paid according to results.
How Much Can I Borrow?
This takes into account many factors, such as how much you deposit, the amount you earn, the number of children you have and what debts (if any) you have in the background. The amount a lender will agree to lend is determined by a total affordability assessment, which will provide insight regarding your income, regular household expenditures and any credit card or loan commitments you might have. A credit check will be undertaken for mortgage purposes to confirm you have sufficient credit rating.
For a more accurate idea of how much you can borrow, get a decision in principle before you apply for a mortgage in full. Make plans to meet with one of our experienced mortgage experts now. Without the need for credit checks, we can at least provide an initial estimate.
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
Our list of happy clients in South-Woodham-Ferrers is long and diverse. If you aren’t convinced that we are the professionals to make the best possible mortgage deal in South-Woodham-Ferrers at the lowest price, take a look at 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
Having more information at your disposal when looking for the most ideal mortgage deal places you in a more advantageous position. The latest mortgage news below will provide the insight you need to properly get started.
Mortgage Regulatory Information
In the UK, most mortgages are provided by building societies, specialised mortgage lenders and banks. There is a total of 200 different financial institutions which offer mortgages in Britain, although Lloyds Banking Group and Nationwide Building Society owns the market’s largest share.
Although banks and building societies have always been closely regulated in the UK, the former Financial Services Authority (now the FCA) implemented a regulatory scheme specifically for mortgages as a result of the Financial Services Act of 2000.
The professional services of mortgage providers are monitored by the FCA. There are stern rules that serve as a guide with regards using unfair, deceitful promotions and adverts, as well as checks for financial service contracts for consumers. Regulations were formerly presented in the rules for Mortgage Conduct of Business (MCOB), although they were changed due to the FCA Mortgage Conduct of Business (MMR) of 2014.
In terms of their financial conduct, organisations collecting deposits in the UK fall under the Prudential Regulation Authority, the FCA’s sister organisation. They make sure firms have capital large enough to cancel out their lending risks.
If you have a complaint about your mortgage provider, the first step is to take up the matter with them. You utilise a complaint procedure via the FCA if you don’t think it has been suitably dealt with. In turn, this can be referred to the Financial Ombudsman Service if deemed necessary. 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”.