What is a mortgage broker
A mortgage broker represents individuals or companies looking to broker mortgage loans. The purpose of mortgage brokers is to look for banks or direct lenders that will willingly provide the specific loan an individual would need. If you work with a mortgage broker in Dulwich-Village, it won’t be so difficult to get a great deal on the mortgage loan you require. If you have a poor credit score or any other problems that could have an impact on your mortgage application, the right mortgage broker can increase your chances immeasurably.
With regulations in place to make sure professional mortgage brokers follow banking and finance laws in the relevant customer jurisdiction, you won’t have to worry about being in the wrong hands.
What Is A Mortgage?
A mortgage is in effect a loan. Quite unlike personal loans however, a mortgage is used as guarantee against a loan, because it is linked to a piece of property. If you default on your payments, your mortgage provider has the right to take back (repossess) the property.
Mortgages are nearly always set for a 25-year period, but long and short terms are also available. As soon as you borrow the money, a plan for repayment is implemented. Mortgages with monthly capital repayment structures are the most common, even though there are other options available.
You won’t only have to repay the capital (the money you borrowed), but also the interest on it. A mortgage – secured by the collateral of the property involved – is a debt instrument that the borrower must repay against the agreed pre-set payment instalments. Individuals and businesses use mortgages to buy property, without having to pay the total value up front. 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.
If the home buyer does not keep up with mortgage payments, the lender can take the property back, as there are bank charges against it. If there is a repossession, the tenants can be evicted by the bank and the property sold to repay the mortgage debt.
Mortgages come in many forms. Borrowers must still pay the same interest rates on fixed rate mortgages as they would for the initial terms of two, three or five years, even though fixed-rate mortgages are available in longer terms. Monthly payments remain constant during the fixed rate term. The borrower’s payments will not be affected by any increase in the market interest rates if they are on a fixed rate. Changes in market interest rates have no effect on the borrower’s mortgage repayment if they have a fixed rate.
After the fixed rate ends, your mortgage normally reverts to a ‘standard variable rate’, which is a rate set by the lender, bank or building society that’s lending you the money. Lenders may change the rates as they see fit; to avoid paying higher monthly rates, you must remember to re-mortgage if you have a good broker or diary system in place. Otherwise, call your current lender and adjust the rate around three months before it’s increased to the variable rate.
In short, the initial interest rate is often a low rate, which can make a mortgage seem more affordable than it really is. The borrower might not be able to keep up with higher monthly payments, should the rates be later increased. Because the variable rates can change at any time, the monthly payments are unpredictable after the initial term.
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. In Dulwich-Village, our mortgage brokers can assist you in finding the ideal mortgage deal to match your unique circumstances and specifications.
Handy Tools and Calculators
With an estimate in mind – in terms of how much you can borrow and cost of the loan – you’ll be able to plan your future more easily. Find out just how much your mortgage repayments are going to be, dependent on your interest rate and full loan amount, using this handy calculator. Just enter those values together with your term and press ‘Click to calculate’ to instantly see how much you’ll need to repay each month.
Why Use A Mortgage Broker?
There are a wide range of benefits to be enjoyed from working with a mortgage broker in Dulwich-Village with regards your mortgage application. Of these benefits, some of the most evident include:
The possibility of saving money is the most obvious advantage of working with a mortgage broker. You’ll be required to complete a few details, but the hard work is managed by an experienced professional, who has your best interests in mind.
For some people, there are doubts regarding this, mostly because mortgage brokers are not fully understood worldwide, so it’s generally thought there must be some sort of catch. As understandable as such thoughts are, it’s important to understand that mortgage brokers have nothing to gain by not working in your best interests.
In truth, brokers have to provide viable reasons to you, their regulatory body, the Prudent Regulation Authority or the Financial Conduct Authority for recommending the mortgage they have. To not do so could lead to them facing significant problems. Exclusive mortgages deals exist on the lower end that can be obtained by a number of mortgage brokers, possibly making the total cost of the loan that bit lower. Reputable mortgage brokers communicate how they expect to be paid for their services, as well as outline the details of the entire loan. Positive user experience is much more valuable to a mortgage advisor company than padding out an individual broker’s pocket.
Finds The Most Advantageous Deal
Your interests – and not those of the lending institution – will be represented by the mortgage broker. In addition to being your agent, they should also be knowledgeable consultants and problem solvers. With access to a wide range of mortgage products, a broker can offer you the greatest value in terms of interest rates, repayment amounts, and loan products. You will be interviewed by the mortgage brokers to determine your needs and goals – both in the short and long term. 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 navigates the client through any situation, handling the process and smoothing any bumps in the road 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. If a borrower requires a loan too large for the bank to approve, a broker can be of benefit by providing the knowledge and ability to successfully source financing.
Save Time & Hassle
It’s never just 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. Unlike working with different lenders – which would require you to complete different forms every time – you’d only need one form with a mortgage broker. 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. To find the best deal in terms of lower rates and overall cost, your broker will make comparisons between popular and less popular lenders.
Reduce the workload for yourself and outsource it to someone who can provide professional advice. A mortgage broker can provide an array of support throughout the application and approval process. This can include assisting with paperwork, responding to questions and helping with government scheme applications, as well as explaining all the available options and loan features you may not have considered or been aware of. These features could include things such as drawdown facilities and options for making extra repayments and offset accounts. A noticeable difference can be made to your overall experience and the cost of your mortgage. If you’re unfamiliar with these concepts and how they might affect you, your broker can clarify and answer any questions via a phone call.
Access to exclusive non-advertised deals
There are exclusive deals that aren’t advertised by banks to which brokers have access. These deals are passed by the banks to the brokers, who then have the responsibility of selling the products. If you contact the bank yourself, you wouldn’t have access to the extra benefits you would otherwise get by speaking to a broker.
A bank can only sell their own deals – not those of the other banks as well – whereas a broker can search the whole market for the best deal.
Better chance of pre-approval success
A mark is left on your credit rating if your request for an Agreement in principle/Decision in principle of a loan is turned down. You’ll need the necessary knowledge and experience a broker has to secure approval on your first attempt.
Access to expert knowledge
Helping people secure loans is what mortgage brokers do for a living. They can access useful information and exclusive deals you likely couldn’t find yourself. If you’re not on the lookout for them, you might not notice the subtleties that accompany loans. The difference to your mortgage could ultimately be made by these subtleties. If you have an experienced professional who can show you these things, you’ll be at a distinct advantage.
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. For home loan requirements, a mortgage broker is the best ways to go, just as a hairdresser is for replenishing damaged hair and a plumber for fixing leaking pipes.
About Mortgage Saving Experts
Mortgages and insurance aren’t as difficult as they first appear. That’s why finding honest advisers with invaluable experience and knowledge is so important. Our Mortgage Saving Experts will make your journey as seamless and transparent as possible. Besides, why complicate things more than necessary? Let us make things easy for you and make sure we find you the most suitable deal.
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 treat each mortgage and insurance application as if it were our own. This is what we’re all about. Mortgage Saving Experts are available whether you’re a first-time buyer, a landlord, moving on to a new phase or just re-mortgaging. We’re here to help! In essence “Get information about 1000s of mortgage deals by taking 15 minutes to speak to 1 adviser.”
Our Team of Brighton Mortgage Experts
Due to regulations by the Financial Conduct Authority (FCA), we must do all we can to get you the most suitable deal on the market. We must justify to our customers and regulators why we make the mortgage recommendations we do, so you know just why you have that 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 are particularly good at listening to your current and future goals. We then work closely with you to achieve those goals.
Why chose Mortgage Saving Experts?
For the first couple of years, you’re allowed an initial rate after taking out a mortgage. After the initial rate period, the rate is then raised to the lender’s variable rate. Our team will contact you three months prior to the date of renewal to strike a new deal, before both your rate and monthly payment are raised. Here are some of the other advantages you’ll enjoy if you work with us:
- With a deal better than the bank variable rate, you’ll subsequently save money.
- You won’t have to remember when the deal is due to end, as we will do this for you.
- You can sit back and relax, while we do all the hard work for you.
- We are good at what we do, so you’ll always be advised by professional mortgage experts.
- We undertake comparisons and then advise and arrange the best mortgage for you, choosing from thousands of deals.
- You’ll be supported and expertly advised throughout the whole mortgage process.
Our Approach to Mortgage Advice
The services we offer are personalised and take into account your unique 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:
Our services are more remarkable than those of other mortgage brokers in Dulwich-Village because:
- Find out what your needs and circumstances are through fact-finding.
- Explain the costs involved with buying and selling.
- Ask for applicable documents necessary for the application.
- Recommend and explain the prospective mortgage.
- Proffer replies to any questions you might have.
- An agreement in principle will be put in place.
- Send in your entire mortgage application.
- 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 provide professional advice on a broad range of mortgage products. You won’t have any difficulty finding the right mortgage products to suit your needs when working with us. The most popular mortgage types we’re requested to handle include:
First time buyers
Most mortgage lenders put people in the First Time Buyers category if they 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.
Different lenders have different ideas and rules regarding this. There usually are no issues in being a First Time Buyer. In order to qualify for stamp duty relief, it’s necessary for First time Buyers to have never been property owners before; this applies anywhere in the world.
Mortgages may appear to be a rather difficult process, but they really don’t have to be. It’s rather exciting to be buying your first home, so if you find a reputable broker to get the job done for you at a fair price, then do use one. Why you should use one is pretty obvious. It stands to reason that you would contact a mechanic if your car became faulty – especially if you knew little or nothing about cars. The same applies to mortgages. With mortgage brokers, you can cut down on money, effort and time, so you should use one. The initial consultation comes at no cost at all.
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. 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 would rather avoid any stress, speak to an adviser, who will guide you accordingly.
Your credit is a necessity.
A mortgage is serious issue. Banks put up a lot of money at their own risk. So much so, they’ve been very careful since the subprime mortgage crisis of 2008. To qualify for a mortgage, good credit is helpful, but not essential. We can also provide guidance about the amount you can afford to pay for your new home and what should be your maximum offer, based on your current circumstances. In addition to assisting you with the purchase of your dream home, we will also help with financing at minimum cost and the most agreeable mortgage available.
Re-mortgage your home
Effectively, all you’d be doing with this is changing to a different lender to find a better or more affordable deal. They don’t necessarily have to be paired together. Let me simplify this for you. If you have a small mortgage, you’ll probably find it’s not worthwhile paying an arrangement fee to the lender just to go on a lower rate. You may realise that it’s less expensive to go on a slightly higher rate than paying any lender an arrangement fee. Even with a lower rate, you could end up having a costlier deal in total, which is why it’s always prudent to talk to someone before you make any decisions. Focus on any small print.
One upside to re-mortgaging is that your usually not required to pay for valuation or solicitors fees, although some people don’t qualify for this. The reason is that it is based on your disposition alone at the time of re-mortgaging. So, please check with your adviser.
A mortgage deal conducted at the right time is an effective way to cut the cost of your mortgage bills significantly. Even though a re-mortgage deal is accompanied by various benefits, it might not the best choice for you, depending on your unique circumstances.
Reasons for remortgaging your property
- Based on your specific needs, such as…
- Mortgage debt isn’t considerable.
- There has been a change in financial circumstances.
- Significant early repayment charge.
- A reduction in home value.
- Existing credit problems.
- Present rate is just fine.
- We will guide you when deciding to re-mortgage or not.
Buy to Let
A ‘buy to let’ property is one bought with a view to renting to others. According to the law, you cannot live in the property. If you’re purchasing a buy to let as a First Time Buyer, the number of lenders available will be restricted and there will be extra checks carried out by the lender in such cases.
- You may need to know certain things when purchasing a buy to let property.
- The loan amount you can borrow is dependent on how much 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 want to buy a second property, find out the amount you’ll be require pay from your conveyancer/solicitor.
- A reputable adviser will know just what questions to ask in order to figure out the best mortgage for your specific needs.
- To see if you’re eligible, reach out now to our advisers.
How Much Do Mortgage Brokers Charge?
Commission is usually paid to mortgage brokers by lenders; this will be a percentage of the mortgage loan you secure. 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. Many independent brokers usually charge about £500 as a flat fee. Remember to ask brokers how they want to be paid. They must be completely clear, letting you know the exact figure and fee structure in place.
We have a fee structure based on charging our clients £695. From that figure, we then deduct any commission received from the mortgage lender Our client will be asked to pay the difference between the commission we are paid and £695, if the amount of commission is less than £695. For instance, if the commission we receive is £495, then we would require you to pay £200 to make up the difference. This can be paid when your mortgage offer has been produced, meaning we only get paid on results.
How Much Can I Borrow?
This is based on a number of factors, such as the amount you deposit, your income, the number of children you have, and any current debts you might have. 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. A credit check will be undertaken for mortgage purposes to confirm you have sufficient credit rating.
To get an idea of the amount you can loan, get a decision in principle before applying for a mortgage in full. Make plans to meet with one of our experienced mortgage experts now. 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 make comparisons on thousands of recent mortgage deals to help you find just what you’re looking for.
What Our clients say About us
The list of happy clients in Dulwich-Village is a lengthy and diverse one. If you’re still not sure that we are the experts to get you the most suitable mortgage deal in Dulwich-Village at the most affordable price, check out some of the things our clients have said about working with us. For a first-hand experience of just how amazing our services are, give us a call today.
Latest Mortgage News
The more information available to you when trying to secure the best mortgage deal, the more advantages you’ll enjoy. Below is the latest insightful mortgage news to help you get started on the right path.
Mortgage Regulatory Information
Most mortgages in the UK are provided by building societies, banks and specialised mortgage lenders. Although a big portion of the market share is owned by Lloyds Banking Group and Nationwide Building Society, all together there are 200 different financial institutions providing mortgages in Britain.
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.
The FCA monitors the professional conduct of mortgage providers. Strict rules exist that monitor the use of dishonest and misleading adverts and promotions, checking to ensure the terms of any contract for financial services are fair to the customer. As a result of the FCA Mortgage Market review of 2014, the initial regulations set out in the rules for Mortgage Conduct of Business were revamped.
Deposit-taking organisations in the UK are under the jurisdiction of the Prudential Regulation Authority (a sister organisation to the FCA) for their financial conduct. They make sure firms have a substantial 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 feel it hasn’t been dealt with to your complete satisfaction, there is a complaints procedure which can be referred 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”.