Mortgages vary quite considerably. There are thousands of mortgage products available on the open market, but how you be sure that you’re really getting the best deal? Specialists at Expert Mortgage Advisor have provided us with their advice on the 3 most important areas in getting the best deal.
1. Don’t always go for the lowest rate
Many borrowers dive straight into mortgages and think it’s as easy as simply selecting a mortgage with the lowest interest rate. This is rarely the case. It’s important to understand the overall cost of the mortgage, as well as the term of the loan. Mortgages with the lowest interest rates may not always be the best choice.
Often enough, products with the lowest rates generally come with very high fees. The most common of mortgages fees include lender arrangement fees and mortgage valuation fees. Such fees can run into the thousands and once totalled up with the interest rate, can prove to be more costly then a product with a slightly higher rate and no fees at all.
2. Shop around for the best mortgage
Again, many homebuyers will flock to their own banks to get a mortgage. That said, this isn’t perhaps the best thing to do. This is because a bank will offer their own mortgage products. Shopping around will give you an idea of the entire market and what’s available. Furthermore, mortgages come packaged in all different shapes and sizes. Researching the mortgage market can open your eyes to all the varying types of products and you may find something that fits exactly what you need.
It’s understandable that a lot of people will visit their own banks as they already have a relationship with the bank. Nonetheless, mortgages are a big financial commitment that can span over decades. The last thing anybody wants to do is to simply go to their own bank and take the first mortgage offered.
In addition, if you have issues such as adverse credit or have recently become self-employed, high street banks will probably decline the application. Banks tend to deal with mortgage applications that are straightforward. If your situation isn’t straightforward, then you may find you need a specialist lender. It can be risky applying in this situation, as if you are declined, it can damage your credit file even more.
3. Speak to a mortgage broker
Having a mortgage broker on your side can save you thousands of pounds. In addition, you gain the expertise, knowledge and support of a specialist in the mortgage field. As previously mentioned, a mortgage is often a lifetime commitment, so you want to be sure to get it right. Being tied in to a mortgage that is financially draining can cause major problems. Having a mortgage broker on your side can ensure that you’re getting the best mortgage suited to your needs.
Mortgage brokers also come with varied knowledge of the market. Using a broker that is considered to be ‘whole of market’ isn’t restricted to a certain lender or panel. This means that whole of market brokers are able to search far and wide for the best possible mortgage that you’ll qualify for.
Using a broker can also take care of the above 2 points. This is because brokers can assess the best products by doing all of the calculations for you. Experienced brokers understand that the lowest interest rate may not be the cheapest overall mortgage, even though it may seem otherwise. Whole of market brokers can also search the entire market for you. Once they’ve carried out their search, they’ll then present some products to you and the reasons on why they’re the best picks.
Furthermore, mortgage brokers can look after the mortgage from start to finish. Having someone that you can talk to and clear up any doubts can be a great relief, especially when buying a house. Even if the underwriters aren’t entirely happy, rather than declining the application, brokers are sometimes able to speak to underwriters and clear up any inconsistencies.
This article was written by Martin Alexander from Expert Mortgage Advisor. With a wealth of experience in buy to let mortgages and working closely with landlords and agents throughout the UK.
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