Mortgages can be confusing, but they don’t have to be, with proper advice you can make sure you’re not getting a bad deal regardless of your needs.
You can, of course, look for your own mortgage lenders, but this can be a time consuming and complex process. A mortgage is probably the biggest financial decision most people make in their lives, and a professional advisor (also known as a broker) can easily find you the best deal.
Let’s look at methods of finding mortgages, as well as some of the types of mortgages for different circumstances.
Where To Find Them
There are several ways of finding mortgages, finding a traditional mortgage advisor in person, looking for one yourself, or seeking online advice from dedicated mortgage specialists. Read on to see more detail of each method.
Looking For A Mortgage By Yourself
As we’ve said, going it alone may be difficult unless you have the specialised knowledge, time, and research skills. There are mortgage comparison tools online that may help you get started.
Due to people losing faith in advice from banks and rules around mortgages becoming more complex, over 60% of loans are taken out through a broker, as of 2014. This is becoming the preferred way to go.
Going with an advisor can cost upwards of £500 in two separate fees (make sure you ask how they charge), however, if you risk not getting advice, you could end up with the wrong mortgage and that could be a much more expensive mistake compared to those initial fees.
Though it’s completely your choice, going straight to a lender could mean missing out on a better deal and unbiased views. A lender will only offer their products and not refer to the market as a whole.
Visiting For Advice In Person
In the traditional way of doing things, you can visit a bank or a mortgage broker in person to get advice. Though it can be awkward having someone look through your financial details, don’t be nervous, these people want you to get a mortgage.
Appointments last from 30 minutes to a couple of hours and may be seen as the old fashion way of doing things since most banks can now help you over the phone. Though many people still prefer the in-person approach for services. For an even easier and time-saving way, you can also seek advice online…
Online Mortgage Advice
As more and more services go online, you can now visit mortgage specialists virtually. Dedicated websites exist to make seeking professional mortgage advice more convenient than ever. You submit your details via a form on the site and the mortgage advisors go to work using specialised software to compare thousands of mortgages that fit your requirements.
Different Types Of Mortgages – First Time Buyer
On the 1st of April 2021, a new 5% deposit scheme was introduced. This will especially help first-time buyers as previously deposits were at least 10% – 20%. Whilst this will help get a foot on the property ladder, if you can afford a bigger deposit, it will mean better deals and lower monthly repayments.
You will need to ask yourself if this is something that you can really afford. Sometimes renting is a better and more convenient option, but it’s also understandable to want to avoid or get away from renting and get on the property ladder.
Types Of Mortgages For When You Need Help
There may be some circumstances that call for a more specialist mortgage to be found, such as:
- Bad Credit Mortgage – it’s still possible to get a mortgage with bad credit history but your options will be more limited. There are specialist bad credit mortgages out there for people who have faced difficult situations such as illness or divorce, etc.
- Guarantor Mortgages – A parent or other family member can act as a guarantor for your loan to get on the property ladder.
Getting A Mortgage
You will have to look as good as possible to get the best mortgage, by looking good, we mean having a good credit score. This can be checked online via various websites which will identify you by asking a few questions such as name, date of birth, address, time spent at the address and then some minor questions about any credit or loans are taken out. They will usually just ask to confirm which companies you have the repayments with.
As well as a good credit score, it’s good to have the biggest deposit you can possibly save, good employment status and income, along with a well-managed level of outgoings. But different lenders will be more flexible, which is why going with an advisor can help you find the best deals.