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. You’ll have a stress-free time getting a great deal on the mortgage you need in Rushmoor if you work with a mortgage broker. If you work with a reputable mortgage broker and have a poor credit score or any other issues that could affect your mortgage application, your chances would be greatly improved.
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?
A mortgage is in effect a loan. As opposed to personal loans, a mortgage is tied to a piece of property, acting as a security against the loan. Mortgage providers can rightfully take back (repossess) the property if you default on your payments.
Mortgages are nearly always set for a 25-year period, but long and short terms are also available. A repayment plan is arranged as soon as you borrow the money. Mortgages with monthly capital repayment structures are the most common, even though there are other options available.
As well as paying back the money you initially borrowed (the ‘capital’), you’ll also be charged interest on that sum. 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. Where mortgages are concerned, individuals and businesses don’t have to make one-time payments up front for large property purchases. The property can be owned by the borrower without a mortgage after the loan plus interest are repaid by them over a period of time. Failure to make mortgage payments can result in the lender taking back the property used as collateral for the mortgage.
The bank has a charge on the house; should the home buyer default on paying the mortgage, then the lender may repossess the property. 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. Even though there are longer fixed rate mortgage terms available, the borrower would have to pay the same interest rate for the initial terms of two, three or five years. Monthly payments do not change during the fixed rate term. An increase in interest rates in the market won’t change the payments of the borrower if they have a fixed rate. The borrower’s mortgage repayments do not change if the market interest rates rise or fall if they have 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.
Quite often, the initial interest rate is a low rate, which can make a mortgage appear cheaper than it is. An increase in interest rates later on could mean that the borrower would not be able to continue with payments. With the possibility of the variable rates being changed at any time after the initial term, monthly payments subsequently become 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. Our mortgage brokers in Rushmoor can help you find the most suitable mortgage deal to match your unique needs and circumstances.
Handy Tools and Calculators
With a clear idea of the maximum you can borrow and how much the loan will cost, it then becomes easier to plan your future. Find out how your interest rate and total loan amount determines your mortgage repayments with this handy calculator. To immediately determine how much you’ll have to repay each month, simply enter the values and your term before pressing ‘Click to calculate’.
Why Use A Mortgage Broker?
Working with a mortgage broker for your mortgage application in Rushmoor can be beneficial in various ways. 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? While this train of thought is understandable, be assured that most mortgage brokers don’t have an incentive to work against your best interests.
In short, a broker is required to give proof of their reasons for recommending the mortgage they have (to you, their regulators, the Prudent Regulation Authority or Financial Conduct Authority) or they could be penalised. There are various inexpensive, exclusive mortgage deals that a number of mortgage brokers can find for their clients that could possibly reduce the total loan cost. Detailing the entire cost of the loan and letting you know how they get paid for their services is the duty of any reputable broker. A positive user experience is more important to a mortgage advisor company than just filling the pocket of an individual broker.
Finds The Most Advantageous Deal
A mortgage broker will always be in favour of your own interests and not those of the lending institution. Not only should the role of being your agent be their focus, they also need to be knowledgeable consultants and problem solvers. You can get the best value as per interest rates, loan products and repayment amounts thanks to the wide range of mortgage products to which a broker has access. To ascertain your goals and needs (both short and long term), you’ll be interviewed by the mortgage broker. The simple use of a 30 or 15-year mortgage is inadequate for many situations, which is why sophisticated solutions and innovative strategies are the benefits of working with an experienced mortgage broker. This includes mortgage to raise capital for repayments, money for necessary home improvements or children, or even to buy other properties such as buy to lets.
Has Flexibility Expertise to Meet Your Needs
A mortgage broker will work with the client in any situation, as well as manage the process and take care of any bumps in the road that may occur. 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 never just about money. Saving some extra cash is great, but so is your time and sanity. Give a thought to the amount of time you’d have to invest when enquiring about various loan types from numerous lenders. You’d only need to complete one application with a mortgage broker, instead of filling out forms for every individual lender. 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.
By outsourcing, you can reduce the workload and get someone else’s 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 can include drawdown facilities, the option to make extra repayments and offset accounts to name a few. These types of features can make a significant difference to your mortgage cost and experience. Better still, if you’re not well versed with these concepts and how they could affect you, your broker can clarify answer questions you may have over the phone.
Access to exclusive non-advertised deals
There are exclusive deals not made public by the banks that brokers have access to. The banks pass these deals on to the brokers, who are responsible for selling the products. Going to the bank directly could cause you to miss out on added benefits such as these, which you can procure by speaking to a broker.
Unlike brokers who have access to the whole market to search for the best deals, banks can offer their own deals alone – and not the deals offered by other banks.
Better chance of pre-approval success
When you request an Agreement in principle/Decision in principle of a loan and are refused approval, this shows up on your credit rating. The experience and knowledge required for your best chance of approval the first time you apply is something brokers have in abundance.
Access to expert knowledge
Helping people secure loans is what mortgage brokers do for a living. There’s much information and numerous exclusive deals available to them that you won’t find by yourself. If you aren’t looking for them, you’re likely to miss the subtle details that come with loans. At the end of the day, these subtleties tend to improve your mortgage chances. It’s beneficial to have an experienced professional to point out these things for you.
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. The same way you would contact a plumber to fix a leaking pipe or a hairdresser to work on damaged hair, contacting a mortgage broker is an ideal option for your home loan needs.
About Mortgage Saving Experts
Contrary to how they might seem initially, mortgages and insurance are not so difficult. That’s why finding honest advisers with invaluable experience and knowledge is so important. Our mortgage savings experts will ease the process for you and make it as simple as possible. Why complicate things more than necessary, after all? Let us simplify everything for you and ensure we get the best deal possible.
Mortgage Saving Experts provide an honest and transparent service that will leave our customers thinking that mortgages and insurance aren’t as daunting as they may seem. All mortgage and insurance applications are handled like they’re our own at Mortgage Savings Experts. This is what we’re primarily concerned with. 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! Approximately “Take 15 minutes to talk to 1 adviser and find out about 1000s of mortgage deals.”
Our Team of Brighton Mortgage Experts
We make it our duty to get you the best deal the market has to offer, as we are regulated by the Financial Conduct Authority. 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 insurance experts take pride in listening to the current and future objectives our customers have. These goals will be achieved when we work with you intently.
Why chose Mortgage Saving Experts?
For the first few years after taking out a mortgage, you’ll be subject to an initial rate. At the end of this initial rate, this returns to the lender’s variable rate. You will be contacted by our team approximately three months prior to the renewal time to agree a new deal, before the monthly payment and rate are increased. Some other reasons for which it’s beneficial to work with us include:
- With a deal better than the bank variable rate, you’ll subsequently save 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.
- To arrange the best deal for you, we compare and dispense advice with regards thousands of mortgage deals.
- You’ll be supported and expertly advised throughout the whole mortgage process.
Our Approach to Mortgage Advice
We make available personalised services and put into consideration all your unique needs. 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 Rushmoor includes:
- Use fact-finding to properly understand your individual needs.
- Point out the costs that come with buying and selling.
- Ask for related documents to help with the application.
- Make relevant suggestions and provide explanations about the prospective mortgage.
- Respond to any questions you might have.
- An agreement in principle should be obtained.
- Have your entire mortgage application sent in.
- Liaise with your estate agent, mortgage lender and solicitor to answer any question through to completion.
Mortgage Types We Provide Expert Advice On
We offer expert advice on a wide variety of mortgage products. By working with our team, you’ll have no trouble finding the perfect mortgage product to match your needs. Some of the most frequently requested types of mortgage we assist with 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.
The rules and ideas on this are different across various lenders. Being a First Time Buyer is not generally considered to be a problem. First Time Buyers must not have owned property anywhere in the world before to be eligible for stamp duty relief for stamp duty purposes.
Mortgage processes may look tough to negotiate, but they really don’t need to be. The prospect of buying your first home comes with a lot of excitement, so if you manage to find a competent broker who can oversee the process at a reasonable price, then go right ahead. The reason you should use one is quite apparent. 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. Mortgage brokers can help you save money, time and effort, so why don’t you use one? The initial consultation is free of charge.
Buying a home
If you’re thinking of a home purchase any time soon – or even within a couple of years – you should familiarise yourself with everything involved with mortgages. Learn what to do when applying, within the application process and even how to use a mortgage after buying your home. If you prefer otherwise, then instead speak to an adviser who will guide you through it.
Your credit is important.
A mortgage is of major importance. 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 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. We will help you with funding, the lowest cost and most suitable deal on offer, in addition to helping you buy your dream home.
Re-mortgage your home
In essence, the only thing you’re doing here is swapping one lender for another to get a cheaper deal or better rate. The two of them don’t have to go hand in hand. Let me explain. 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. Being on a rate that’s a bit higher may seem more agreeable to you than paying an arrangement fee to any lender. 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. Tread carefully.
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 because only your circumstances are considered at the time of re-mortgaging. So, do find out from your adviser.
A re-mortgage completed on time is a smart way to significantly reduce the cost of your mortgage related bills. While a re-mortgage deal can be beneficial for some, it’s not the best move for everyone, as it all depends on your unique circumstances.
Reasons for remortgaging your property
- Based on your individual circumstances, like…
- Mortgage debt is relatively small.
- There have been significant changes in financial disposition.
- Early repayment charge is on the high side.
- Home value reduced.
- You have credit problems.
- Present rate is just fine.
- We will dispense advice on the merits of pursuing a re-mortgage.
Buy to Let
‘Buy to let’ properties are those you wish to purchase and then rent to tenants. You aren’t allowed to live in the property by law. If you’re a First Time Buyer, you can purchase a buy to let property, but the number of lenders available is restricted. There are also extra checks made by the lender in these circumstances.
- When purchasing a buy to let property, there are a few things you’ll need to know.
- The loan amount you can borrow is largely dependent on the rental income you receive.
- You will have to pay 3% stamp in addition to your normal stamp duty.
- You’ll still have to pay the extra 3% of the purchase price, even if the property isn’t valued as it should be for the stamp duty to be liable.
- TIP: If you’re purchasing a second property, ask your conveyancer/solicitor about the figure you’ll have to pay.
- A good adviser will know the exact questions to pose and will find a mortgage that fits your exact requirements.
- Get in touch with our advisers to see if you’re eligible.
How Much Do Mortgage Brokers Charge?
Many mortgage brokers are paid commission from lenders, which represents a percentage of your mortgage loan. This is usually around 0.33%, although this does vary massively, depending on what mortgage you require. For example, this would take into account buy to let or residential mortgages and whether you’ve had any credit problems in the recent past. A flat fee of roughly £500 is usually charged by the majority of independent brokers. Be sure to enquire about how to make payments to brokers. They need to be totally clear, informing you of the fee structure they use and just how much you are due to be charged.
We charge the client £695 as part of our fee structure; if the mortgage lender pays any commission, it is then deducted from that figure. If we receive a commission below the value of £695, we ask the client to pay the difference between the received commission and £695. For example, if we received a commission of £495, we would then ask you for a fee of £200 which is payable on production of your mortgage offer, so we are only paid on results.
How Much Can I Borrow?
This takes into account many factors, such as how much you deposit, the amount you earn, the number of children you have and what debts (if any) you have in the background. The amount a lender would be willing to lend is dependent on a comprehensive affordability assessment that helps them understand your income, as well as any loan or credit card commitments you might have and everyday household expenses. For mortgage purposes, they will also perform a credit check to be sure you have an adequate credit rating.
To get an idea of the amount you can loan, get a decision in principle before applying for a mortgage in full. Arrange for an appointment with one of our certified mortgage experts today. At the initial stage, we can give you an estimate, without needing to perform 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
Our list of happy clients in Rushmoor is long and diverse. If you doubt that we are the professionals most capable of finding you the best mortgage deal in Rushmoor at the lowest price, check out what some of our customers have to say about their experience with us. To get a first-hand experience of the great services we provide, call us today.
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. 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 professional conduct of mortgage providers is regulated by the FCA. 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.
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.
If there is something bothering you about your mortgage provider, talking to them about it is the first step to take. If you don’t like how the issue has been dealt with, you can take your complaint 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”.