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 Southgate, it won’t be so difficult to get a great deal on the mortgage loan you require. 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?
Simply put, a mortgage is 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. Mortgage providers can rightfully take back (repossess) the property if you default on your payments.
While shorter or longer terms are available, mortgages are usually set for a 25-year period. A repayment plan is arranged as soon as you borrow the money. Although mortgages which involve monthly capital repayment plans are more common, there are also other types of mortgage available.
Aside from repaying the money you borrowed initially, you will be charged interest on the amount you’ve been loaned (the ‘capital’). Acquired by the collateral of a particular property, a mortgage is an instrument of debt the borrower is required to repay, according to a pre-set payment structure. Mortgages are a vehicle for individuals and businesses to make large property purchases, without paying the entire value of the purchase up front. Over time, the loan and interest included can be repaid by the borrower, before the property can become theirs without any mortgage. Failure to make mortgage payments can result in the lender taking back the property used as collateral for the mortgage.
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 bank can evict the tenants, sell the property and use the income to pay off the mortgage debt if there is a repossession.
Mortgages come in many forms. With a fixed rate mortgage, the borrower pays the same interest rate for an initial term (i.e. two, three or five years), although longer fixed rate terms are available. Monthly payments do not change 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. An increase or decrease in the market interest rate will not affect the borrower’s mortgage repayments 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. If interest rates increase at a later date, the borrower may not be able to afford the higher monthly payments. 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. Our mortgage brokers in Southgate can help you find the most suitable mortgage deal to match your unique needs and circumstances.
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. Use this handy calculator to see just how much your mortgage repayments are going to be, based on your total loan amount 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?
There are a wide range of benefits to be enjoyed from working with a mortgage broker in Southgate with regards your mortgage application. Of these advantages, some of the more prominent include:
In working with a mortgage broker, the most noticeable benefit would be the opportunity to save money. You’ll just need to fill out some details and an experienced professional with your best interests in mind will deal with the hard work.
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? 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 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 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. A reputable mortgage broker will disclose details of how they take payment for their services and convey the components which make up the entire mortgage cost. 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
A mortgage broker will work towards protecting your interests, rather than those of the lending institution. They shouldn’t just play the role of your agent, but also those of problem solver and knowledgeable consultant. For terms like interest rates, repayment value and loan products, you can get the best possible value from a broker, who has access to a wide array of mortgage products. To ascertain your goals and needs (both short and long term), you’ll be interviewed by the mortgage broker. 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 example, borrowers with bad credit issues can find great products that will suit their needs through brokers who know lenders that offer such products. A broker will be beneficial in providing the necessary knowledge to source financing if a borrower requires a loan that’s larger than the bank would normally approve.
Save Time & Hassle
It’s never just about money. While it’s a good thing to save some extra money, your sanity and time matter just as much. Consider how much time it would take you to research multiple loan types 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. A formal comparison of the recommended loans can be made available by your broker to provide information that would clearly show the differences in cost, including current rates and the costs of closing each of the loans. 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 do a lot of the work by providing you with support throughout the application and approval process. This might involve completing all paperwork, helping you with applications to government schemes, answering questions and explaining the options and loan features, about which you may not have been aware. Drawdown facilities, offset accounts and extra repayments (to name a few) are just some of the features involved. These types of features can make a significant difference to your mortgage cost and experience. Better still, your broker can answer any questions you might have over the phone or provide clarity if you don’t know much about these concepts and the impact they could have on you.
Access to exclusive non-advertised deals
Brokers have access to exclusive deals which the banks do not announce. These deals are passed by the banks to the brokers, who then have the responsibility 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.
A bank can provide access to their own deals (not those offered by other banks), but brokers can gain access to the entire market to find the best deals.
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. 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. Helpful information and exclusive deals you won’t find yourself are accessible to them. There are small details accompanying loans that you might miss if you’re not looking 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.
Rather than sacrifice a chunk of your day researching thousands of loans and lenders (and still potentially missing out on key subtleties), why not let someone with industry experience handle the work? Just as you would contact a plumber for a leaking pipe or a hairdresser to replenish damaged hair, a mortgage broker is an excellent choice for all your home loan needs.
About Mortgage Saving Experts
Mortgages and insurance are not as complex as they seem at first. Finding an adviser who is reliable, knowledgeable and has significant experience is very important for this reason. Our mortgage savings experts will make your task as easy and straightforward as possible. Besides, why complicate things more than necessary? Allow us to ease the entire process and obtain the best deals available for you.
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. This is what we’re all about. No matter the circumstances – whether this is your first time buying, you’re a landlord, moving onto a new chapter or even re-mortgaging, Mortgage Saving Experts are here to help. Assisting you is the reason we’re here! Basically “Find out about 1000s of mortgage deals by putting 15 minutes aside to talk 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. You’ll get to understand why you received the mortgage you did, because we have to justify the recommendations we make to both you and our regulators.
Down to Earth Mortgage
We are an honest team of mortgage insurance experts, who are enthusiastic, passionate and widely experienced.
Our mortgage insurance experts take pride in listening to the current and future objectives our customers have. We will then work together with you to reach these goals.
Why chose Mortgage Saving Experts?
When you take out a mortgage, you’ll be subject to an initial rate for the first few years. The lender’s variable rate is implemented after the initial rate is complete. 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. Here are some of the other advantages you’ll enjoy if you work with us:
- The deal you’ll get is better than the bank variable rate, which in turn saves you money.
- We can provide updates relating to the end of your deal, so you need not worry.
- While we deal with the stress on your behalf, you can sit back and ease your mind.
- We know our onions, so you’ll only ever be advised by a qualified mortgage expert.
- We compare, advise and arrange the best mortgage for you from thousands of available deals.
- Expert advice and support will be available to you through the entire mortgage process.
Our Approach to Mortgage Advice
Your individual needs will be duly considered, as we provide fully personalised services. Our approach 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 Southgate includes:
- Use fact-finding to properly understand your individual needs.
- Explain the costs involved with buying and selling.
- Request relevant documents to assist with the application.
- Recommend and explain all about the prospective mortgage.
- Respond to any questions you might have.
- Obtain an agreement in principle.
- Submit your full mortgage application.
- We will collaborate with your estate agent, solicitor and mortgage lender and reply to any questions through to completion.
Mortgage Types We Provide Expert Advice On
We advise expertly on a vast selection 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
Many mortgage brokers consider First Time Buyers 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.
For each lender, the rules and ideas about this differ. Being a First Time Buyer is usually not an issue. To qualify for stamp duty relief as First Time Buyers, you must have never owned a property before, anywhere in the world.
The mortgaging process might appear to be challenging, but this isn’t necessarily so. 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. The purpose of using one is straightforward enough. If you have no knowledge about cars and yours develops a fault, you would call a mechanic rather than attempt to fix it yourself. With mortgages, the same principle applies. You can save on time, effort and even money with mortgage brokers, so you should use one. The initial consultation will cost you nothing.
Buying a home
If you’re considering buying a home in the near future or further down the line, you should get to know mortgages a lot better in the meantime. Find out what to do before applying for a mortgage; during the application process; and how to use it accordingly after purchasing your home. If you would rather avoid any stress, speak to an adviser, who will guide you accordingly.
Your credit is of great importance.
A mortgage is a serious affair. Since the subprime mortgage crisis in 2008, banks have trodden more carefully in terms of risking money up front. Qualifying for a mortgage is boosted by good credit, but it isn’t compulsory. We can also offer guidance regarding how much you can afford to pay for your new home and how to set your limit, depending on your ongoing situation. 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
In short, this means you’ll switch from one lender to another to get a more affordable rate or cheaper deal. The two of them don’t have to go hand in hand. I’ll explain this clearly. If your mortgage isn’t so big, you might consider it not worthwhile to pay an arrangement fee to a new lender for a low rate. It may seem cheaper to be on a slightly higher rate than pay an arrangement fee to another lender. Even if the rate is lower, you could find that you chose a more expensive deal when you add it all up, hence the need to speak to someone before deciding. 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. This is because it is dependent on your circumstances alone at the time of re-mortgaging. So, please check with your adviser.
A re-mortgage completed on time is a smart way to significantly reduce the cost of your mortgage related bills. 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
- Depending on your individual circumstances, such as…
- Mortgage debt isn’t considerable.
- The financial situation is no longer the same.
- Costly early repayment charge.
- A reduction in home value.
- You’re dealing with credit problems.
- Already on a great rate.
- We will dispense advice on the merits of pursuing a re-mortgage.
Buy to Let
A property bought with the purpose of renting to tenants is known as ‘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 a few things you may need to be aware of when purchasing a buy to let property.
- The loan amount you can borrow is dependent on how much rental income you receive.
- You’ll have to pay an extra 3% stamp duty on top of 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: You should ask your solicitor/conveyancer to figure out how much you must pay when considering buying a second property.
- A good adviser will know the exact questions to pose and will find a mortgage that fits your exact requirements.
- 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. While the figure varies widely, it is generally set at around 0.33%, depending on the type of mortgage you require. For example, this could be a residential mortgage or buy to let and would take into account whether you’ve had any credit troubles recently. A flat fee of roughly £500 is usually charged by the majority of independent brokers. Be sure to find out from brokers how you pay them. They must be completely clear, letting you know the exact figure and fee structure in place.
The fee structure we adopt is based upon charging the client £695 and deducting from that figure any commission paid by the mortgage lender. If the commission paid to us falls short of £695, our client will then be asked to make up the difference between the commission we receive and the figure of £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. A total affordability assessment is required to determine how much a lender will agree to lend; this takes into account your income, any loan or credit card commitments you have, as well as regular household expenses. For mortgage purposes, they will also perform a credit check to be sure you have an adequate credit rating.
To be sure of how much you can borrow, obtain a decision in principle, prior to completing a full application. Make plans today for an appointment with one of our capable mortgage experts. Without the need for credit checks, we can at least provide an initial estimate.
The Latest Best Mortgage Rates
Whether you’re looking to re-mortgage, move home, find a first-time buyer mortgage or a buy-to-let, we can help. We compare thousands of the latest mortgage deals, so you can find the one you’re after.
What Our clients say About us
The list of happy clients in Southgate is a lengthy and diverse one. If you’re not yet persuaded that we are the experts who can get you the best mortgage deal in Southgate at the cheapest cost, see what some of our customers have got to say about working 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 at your disposal when seeking the best mortgage deal, the better the position you’ll be in. The latest mortgage news below will provide the insight you need to properly get started.
Mortgage Regulatory Information
Banks, building societies and specialised mortgage lenders account for the bulk of mortgage providers in the UK. 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.
In the UK, despite there being tight regulations that guide banks and building societies, a regulatory scheme was implemented by the FCA (formerly the Financial Services Authority) in response to the Financial Services Act 2000.
The professional conduct of mortgage providers is regulated by the FCA. Tough rules are in place concerning checks that ensure customers are fairly treated in terms of contracts for financial services, as well as misleading and unfair adverts and promotions. The original regulations represented in the rules for Mortgage Conduct of Business (MCOB) were reconstructed due to the 2014 FCA Mortgage Market Review (MMR).
The Prudential Regulation Authority (a sister organisation to the FCA) presides over deposit-taking organisations in the UK, with regards 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 handled properly, there is a procedure that can have your complaint 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”.