What is a mortgage broker
A mortgage broker acts as an intermediary who brokers mortgage loans on behalf of individuals or businesses. The job of a mortgage broker is to identify banks or direct lenders that would make the actual loan an individual seeks. Finding a good deal for a mortgage loan in Egham 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.
There are regulations in place to guide professional mortgage brokers and make sure they adhere to banking and finance laws in the jurisdiction of customers, so you can be sure you’re in good hands.
What Is A Mortgage?
In simple terms, a mortgage is 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. Although mortgages which involve monthly capital repayment plans are more common, there are also other types of mortgage available.
In addition to repaying the original loan (the ‘capital’), you’ll also have to pay interest on top. 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. Large properties can be bought by individuals and businesses via a mortgage facility, whereby they don’t have to pay the entire cost immediately. Over time, the loan and interest included can be repaid by the borrower, before the property can become theirs without any mortgage. The lender can repossess the property against which the mortgage is secured if the borrower does not keep up with mortgage payments.
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.
There are several types of mortgages. 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. The monthly payment never changes during the fixed rate term. The borrower’s payments will not change on a fixed rate, even though the market interest rates increase. If market interest rates drop or increase, the borrower’s mortgage repayment remains the same if they are on a fixed rate.
At the end of the fixed rate, your mortgage would revert to a ‘standard variable rate’ put in place by the lender, bank or building society from whom you borrow the money. 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 fact, the initial interest rate is usually a low rate, which can make a mortgage appear less expensive than it is. If interest rates increase at a later date, the borrower may not be able to afford the higher monthly payments. Because the variable rates can change at any time, the monthly payments are unpredictable after the initial term.
There are other types of mortgages, such as interest-only mortgages, offset mortgages, tracker rates, bridging loans, secured loans and buy to lets, which are less common but may be available nevertheless. Therefore, you should contact an independent broker to know your options. Our mortgage brokers in Egham can provide help for getting the best mortgage deal to suit your personal specifications and requirements.
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. 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. 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 on your mortgage application with a mortgage broker in Egham comes with many different benefits. 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. An experienced expert can take care of the hard work and see to it that your interests are protected. You’ll only need to provide a few details.
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. A mortgage broker wouldn’t stand to gain anything by not working in your favour. You’ll need to bear this in mind, even though any concerns you might have are understandable.
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. Reputable mortgage brokers will usually inform you how they get paid for their services, as well as disclose the details of the entire cost of the loan. Filing the pockets of a broker is of little value to a mortgage advisor company when compared to making sure customers have a positive experience.
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. You will be interviewed by the mortgage brokers to determine your needs and goals – both in the short and long term. Amongst the benefits of working with experienced mortgage brokers are innovative mortgages and sophisticated solutions, because regular 15 or 30-year mortgages aren’t usually sufficient. These include money for children or carrying out much needed renovations, mortgages to raise capital for repaying debts or even money to buy other properties like buy to lets.
Has Flexibility Expertise to Meet Your Needs
The client will be under the direction of a mortgage broker, who will manage the process and handle any issues that could arise 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. Borrowers who find they need larger loans than their bank will approve can also benefit from a broker’s knowledge and ability to successfully obtain financing.
Save Time & Hassle
It’s not all about money. While it’s a good thing to save some extra money, your sanity and time matter just as much. Give a thought to the amount of time you’d have to invest when enquiring about various loan types from numerous lenders. You’d be required to fill out just one application with a mortgage broker, unlike completing one for every different lender. 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. 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. 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. Some of these features can include drawdown facilities, offset accounts and options for extra repayments to name but a few. A noticeable difference can be made to your overall experience and the cost of your mortgage. 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. Contacting a broker will unlock these extra benefits you would miss out on if you were to approach the bank yourself.
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 you’re knocked back after requesting an Agreement in principle/Decision in principle of a loan, this will leave a mark against your credit rating. With the required knowledge and experience brokers possess, you’ll have a better chance at approval the first time around.
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 the long run, subtleties like these are significant to your mortgage. It’s beneficial to have an experienced professional to point out these things for you.
Rather than putting time aside to research thousands of loans and several lenders – and still possibly miss important subtleties – why not let someone else who has industry experience handle the work? 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 might seem really complicated at first, but they’re not. That’s why finding honest advisers with invaluable experience and knowledge is so important. 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? Let us make things easy for you and make sure we find you the most suitable deal.
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. Here at Mortgage Saving Experts, we treat all mortgage and insurance applications as our own. These are the things we’re 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. We’re here to help! Essentially “Search 1000s of mortgage deals by taking 15 minutes to speak to 1 adviser.”
Our Team of Brighton Mortgage Experts
Because we’re regulated by the Financial Conduct Authority (FCA), we strive to get you the best possible deal on the market. 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 team of mortgage insurance experts, who are enthusiastic, passionate and widely experienced.
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?
You’ll get an initial rate for the first few years after taking out a mortgage. The rate is raised to the lender’s variable rate after the initial rate ends. 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. Included below are the plus points of working with us:
- You’ll save some money, as the deal you get is better than the bank variable rate.
- You don’t have to remember when your deal finishes, as we will do this for you.
- You can sit back and relax, while we do all the hard work for you.
- 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.
- You’ll receive expert advice and support throughout the entire mortgage process.
Our Approach to Mortgage Advice
We make available personalised services and put into consideration all 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:
The reasons our services are better than those of other mortgage services in Egham include:
- Find out what your needs and circumstances are through fact-finding.
- Spell out the costs buying and selling involves.
- Ask for related documents to help with the application.
- Propose and explain the likely mortgage.
- Provide answers to your questions.
- Obtain an agreement in principle.
- Have your full mortgage application submitted.
- 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 provide professional advice on a broad range of mortgage products. In collaboration with our team, you won’t have any trouble finding the best mortgage products to match your specific requirements. Some of the most frequently requested types of mortgage we assist with 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.
The rules and ideas on this are different across various lenders. 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. 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. 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. It’s the same with mortgages. You can save on time, effort and even money with mortgage brokers, so you should use one. You won’t have to pay for the initial consultation.
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. 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 crucial.
A mortgage is serious issue. Since the subprime mortgage crisis in 2008, banks have trodden more carefully in terms of risking money up front. To qualify for a mortgage, good credit is helpful, but not essential. 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
Basically, what you’re doing here is changing lenders to get a more suitable rate or cheaper deal. The two don’t automatically go hand in hand. I’ll explain this clearly. 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 realise that it’s less expensive to go on a slightly higher rate than paying any lender an arrangement fee. It’s always best to speak with someone before deciding which deal to go for, as you don’t want to be caught out by being tied to a more expensive deal overall, even if the rate is much lower. Be careful.
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 only your circumstances are considered at the time of re-mortgaging. So please check or ask your adviser.
A re-mortgage completed on time is a smart way to significantly reduce the cost of your mortgage related bills. Depending on your specific needs, a re-mortgage deal might not be the best option, even though it does have its advantages.
Reasons for remortgaging your property
- Depending on your individual circumstances, such as…
- Mortgage debt is relatively small.
- There have been significant changes in financial disposition.
- Costly early repayment charge.
- Decrease in home value.
- Existing credit problems.
- Present rate is very agreeable.
- We will provide guidance to help you choose whether to re-mortgage.
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 a First Time Buyer, the number of available lenders will be restricted if you’re purchasing a buy to let, while extra checks would be carried out by the lender in such cases.
- When purchasing a buy to let property, there are a few things you’ll need to know.
- The loan amount you can borrow is mostly based on the total rental income you receive.
- You’ll be required to pay a 3% stamp duty after 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: You should ask your solicitor/conveyancer to figure out how much you must pay when considering buying a second property.
- 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?
Most mortgage brokers get paid commission from lenders, which will be a percentage of the mortgage loan you receive. Depending on the type of mortgage you need – whether buy to let or residential mortgage for instance – and whether you’ve had any credit problems of late. The figure is often set at around 0.33%, although this varies widely. 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.
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 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. 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. In addition, they also perform a credit check to make sure your credit rating is suitable for mortgage purposes.
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. Initially, we can at least give you an idea, without needing to conduct any credit checks.
The Latest Best Mortgage Rates
We can help, whether you’re seeking to re-mortgage, purchase a buy to let, move home or find a mortgage for a first-time buyer. We compare thousands of the latest mortgage deals, so you can find the one you’re after.
What Our clients say About us
We have a list of clients in Egham that is both lengthy and diverse. If you doubt that we are the professionals most capable of finding you the best mortgage deal in Egham at the lowest price, check out what some of our customers have to say 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. The latest mortgage news below will provide the insight you need to properly get started.
Mortgage Regulatory Information
Building societies, specialised mortgage lenders and banks provide the most mortgages across the UK. 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.
Due to the Financial Services Act 2000, a regulatory scheme specifically for mortgages was implemented by the former Financial Services Authority (now the FCA), even though close regulations have always been in place to guide banks and building societies in the UK.
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. 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.
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 adequate capital levels to balance out their lending risks.
For lodging complaints about your mortgage provider, the first step is to take it up 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”.