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. Mortgage brokers function to find banks or lenders that will willingly make the exact loan an individual requires. With a mortgage broker in Abinger-Common, you’ll have an easier time procuring the mortgage loan you need at the best possible terms. The right broker will also improve your chances of getting a mortgage, even if you have a poor credit score or are subject to any other circumstances that could complicate your mortgage application.
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?
Quite simply, 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. If you fail to make payments when due, your mortgage provider would have the right to repossess (take back) the property.
Mortgages are usually set for a set period of 25 years, but can sometimes be set for longer or shorter terms. Once you’ve borrowed the money, a repayment plan is then set in place. 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’). 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. Where mortgages are concerned, individuals and businesses don’t have to make one-time payments up front for large property purchases. 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. 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 various guises. With a fixed rate mortgage, even though there is provision for longer fixed rate terms, borrowers are expected to pay the same interest rate for the initial terms (being two, three or five years). Monthly payments remain constant during the fixed rate term. The borrower would continue with the same payments if they have a fixed rate, even if the market interest rates go up. If market interest rates drop or increase, the borrower’s mortgage repayment remains the same if they are on 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.
A mortgage can seem less costly than it really is, with the initial interest rate often being a low rate. An increase in interest rates later on could mean that the borrower would not be able to continue with payments. After the initial term, variable rates can be adjusted at any time, making the monthly payments unpredictable.
Other less common types of mortgages – such as interest-only mortgages, tracker rates, offset mortgages, buy to lets, bridging loans and secured loans – could also be available to you, so speak with an independent broker to determine your options. To match any needs and requirements you might have, our mortgage brokers in Abinger-Common can help to find the best possible mortgage deal for you.
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 Abinger-Common comes with many different benefits. Some of the more obvious benefits 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 sceptical about this – especially with the concept of a mortgage broker not yet universally understood. There must be a catch somewhere, surely? Even though this line of thought is understandable, you can rest easy, because not working in your best interests is in no way profitable to a mortgage broker.
If the broker cannot provide genuine reasons for recommending the mortgage they have (to you, their regulators, the Financial Conduct Authority or the Prudential Regulation Authority), then they could be in serious trouble. Many mortgage brokers can obtain exclusive mortgage deals not found on the high street, potentially making the total loan cost lower 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. 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’ll be required to meet with the mortgage broker to document your needs, as well as your short and long term goals. Many situations demand more than the simple use of a 30-year or 15-year mortgage. Therefore, innovative mortgage strategies and sophisticated solutions are distinct advantages of working with an experienced mortgage broker. These include mortgage to raise capital for repaying debts, money for the children or essential home improvements, or even to enable the purchase of other properties such as 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 example, borrowers with bad credit issues can find great products that will suit their needs through brokers who know lenders that offer such products. If a borrower requires a large loan – considerably more than what the bank will approve – the knowledge and expertise of a broker in securing financing would be a distinct advantage.
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. Imagine how much time it would take to find out about the numerous types of loans available 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 loans recommended can be provided by your mortgage broker to act as a guide for the information that accurately illustrates the differences in cost, showing present rates and points, as well as closing costs for each loan. Major lenders and those not so popular will be compared by your broker to seek out the most suitable deal for you, in terms of 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. 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. Some of these features can include drawdown facilities, offset accounts and options for extra repayments to name but a few. 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 that aren’t advertised by the banks. 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.
Brokers can search the whole market for the finest deal, whereas individual banks can only offer their own deals and not those of other banks.
Better chance of pre-approval success
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. 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. They have access to information and select deals you wouldn’t discover by yourself. Loans come with certain subtleties you could miss if you’re not looking out for them. The difference to your mortgage could ultimately be made by these subtleties. It’s beneficial to have an experienced professional to point out these things for you.
Instead of removing a chunk of your day to conduct voluminous research of loans and multiple lenders as well as possibly missing important subtleties, why not give the work to a person who has ample industry experience? 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 aren’t as difficult as they first appear. This is why it’s very important to find honest advisers, who are knowledgeable and experienced. Our mortgage savings experts will ease the process for you and make it as simple as possible. Besides, why complicate things more than necessary? Allow us to ease the entire process and obtain the best deals available for you.
You’ll be left thinking that mortgages and insurance are not as difficult as they appear, because of the reliable and transparent service Mortgage Saving Experts provide our customers. Here at Mortgage Saving Experts, we treat all mortgage and insurance applications as our own. 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 “Search up to a thousand mortgage deals by talking to an adviser for roughly 15 minutes.”
Our Team of Brighton Mortgage Experts
As we are bound by regulations of the Financial Conduct Authority (FCA), we must ensure we get you the best available deal on the market. We are required to justify our reasons for making the mortgage recommendations we do to both you and our regulators, so you can understand why you have the mortgage you have.
Down to Earth Mortgage
We are an honest, enthusiastic and passionate team of mortgage insurance experts, with years of industry experience.
Your current and future goals will be identified by our mortgage insurance experts after talking with you. These goals will be achieved when we work with you intently.
Why chose Mortgage Saving Experts?
For the first couple of years, you’re allowed an initial rate after taking out a mortgage. After this initial rate finishes, the rate increases to the lender’s variable rate. 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:
- With a deal better than the bank variable rate, you’ll subsequently save money.
- We will help you keep abreast of the expiry dates for deals, so you won’t have to worry.
- You can take a breather, while we do the bulk of the work.
- This is our area of expertise; you’ll always receive advice from a qualified mortgage expert.
- Comparing, advising and setting up the best possible mortgage deal from amongst the many available is what we do.
- 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 take three basic steps in our approach to mortgage advice:
- 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 Abinger-Common include:
- Get to determine your situation and requirements by fact-finding.
- Clarify the costs related to buying and selling.
- Request relevant documents to assist with the application.
- Make relevant suggestions and provide explanations about the prospective mortgage.
- Respond to any questions you might have.
- Collect an agreement in principle.
- Get your whole 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 advise expertly on a vast selection 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 commonly requested mortgage types we help with include:
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.
The rules and ideas on this are different across various lenders. Being a First Time Buyer is usually not an issue. To qualify for stamp duty relief, First Time Buyers must have never been property owners in any location in the world previously.
While mortgages may look like a tedious process, they 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. 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. The same applies to mortgages. You can cut down on cost, effort and time with mortgage brokers, so why not 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. 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 a serious affair. The banks risk a lot of money and have been increasingly cautious since the subprime mortgage crisis in 2008. 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. Not only will we help you buy your dream home, we’ll also help you finance it with the lowest cost and most convenient mortgage deal available.
Re-mortgage your home
Simply put, all you’re doing with this is changing from one lender to another to get a better rate or cheaper deal. The two don’t automatically go hand in hand. Let me make it clearer. If your mortgage is a small one, you might find that it isn’t profitable paying an arrangement fee to a lender to secure a lower rate. You may find it’s more practical to go on a slightly higher rate, without paying arrangement fees to any lender. Asking for advice before making up your mind about the deal is important, so that you don’t end up with a more expensive deal on the whole, even at a lower rate. Be careful.
One advantage of re-mortgaging is that you won’t have to pay any valuation or solicitors fees. That said, not everyone is eligible for this exemption. This is due to the fact that it is based solely on your disposition at the time of re-mortgaging. So, please ask your adviser about it.
A brilliant way to ensure you cut down on your mortgage bills is to re-mortgage on time. Depending on your circumstances, it might not be the ideal move for you – even though a re-mortgage arrangement certainly has its benefits.
Reasons for remortgaging your property
- Depending on your individual circumstances, such as…
- Mortgage debt is considerably small.
- The financial disposition is now different.
- Early repayment charge that’s costly.
- Home value dropped.
- You are having trouble with credit.
- Already on a suitable current rate.
- We will provide guidance to help you choose whether to re-mortgage.
Buy to Let
A property purchased in order to be rented to tenants is a ‘buy to let’. You are not allowed to legally live in the property. The number of available lenders will be restricted if you’re a First Time Buyer, purchasing a buy to let property. Also, extra checks are made by the lender in cases like these.
- There are a few things you may need to be aware of when purchasing a buy to let property.
- The rental income you receive is a primary factor when determining the size of the loan you can borrow.
- 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: If you’re purchasing a second property, ask your conveyancer/solicitor about the figure you’ll have to pay.
- To help determine the most suitable mortgage to meet your needs, an expert mortgage adviser will know the specific questions to which you will need to provide answers.
- 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. 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. The majority of independent brokers typically charge a flat fee of around £500. Be sure to find out from brokers how you pay them. They must be completely transparent, telling you how much is being charged and what fee structure they use.
For our fee structure, we charge clients £695; any commission we receive from mortgage lenders is subtracted from that figure 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. If we receive a mortgage commission of £495 for example, we would ask our clients to pay us the difference of £200 after the mortgage offer is produced, so we are only paid on results.
How Much Can I Borrow?
Many factors affect this, such as how much you earn, the amount you deposit, the number of children you have, as well as any debts you might have in the background. 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.
Prior to applying for a mortgage in full, obtain a decision in principle to form a clear picture with regards the amount you can borrow. Arrange an appointment with one of our qualified mortgage experts today. Initially, we can at least give you an idea, without needing to conduct any credit checks.
The Latest Best Mortgage Rates
Our services are available whether you want to re-mortgage, move home, purchase a buy to let or procure a first-time buyer mortgage. We make comparisons between thousands of recent mortgage deals to help you find the one you want.
What Our clients say About us
We have a list of clients in Abinger-Common that is both lengthy and diverse. If you’re still not sure that we are the experts to get you the most suitable mortgage deal in Abinger-Common at the most affordable price, check out some of the things our clients have said about working with us. For a personal experience to discover how effective our services are, contact us today.
Latest Mortgage News
The more information you have to hand in your search for the ideal mortgage arrangement, the greater advantage you’ll have. Below can be found recent news on mortgages to provide the insight you need to get started.
Mortgage Regulatory Information
The majority of mortgages in the UK are made available by banks, building societies 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.
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. 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).
With regards their financial conduct, deposit-taking firms in the UK come under the jurisdiction of FCA’s sister organisation, the Prudential Regulation Authority. They ensure firms have a high enough level of capital to offset their lending risks.
Taking up the matter with your mortgage provider is the first step to take if you have any complaints about 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”.