Mortgages can be a minefield. From getting the best rate to working out what you can afford, there’ll be a mortgage out there that’s right for you – you just need to take the time to find it! Here’s a guide to what you need to consider…
Look for the best rate
The first rate you come across isn’t necessarily going to be the best one, so check to find out what’s on offer.
Many mortgage lenders will advertise an interest rate you may not be eligible for, so ensure you know what rate you’re signing up to.
Find out how long the rate will last for and if it’s fixed, or a variable rate that will go up or down according to the Bank of England interest rate.
It’s very difficult to predict what will happen to interest rates in the long term, so try to remain as flexible as possible.
The bigger deposit you have, or the more equity in your house you have, the better deal you will find.
Read the fine print
When you take out a mortgage there are terms you’ll need to abide by, so make sure you check these before signing anything!
Be totally certain you can meet the payments comfortably from your existing salary. And don’t sign up for extras such as payment protection insurance without taking advice.
Look out for arrangement fees too, they usually apply to most new mortgage deals.
Seek independent advice
Experts advise that you find an independent, ‘whole of market’ mortgage broker to speak to about finding the right mortgage deal. They will talk you through all of the options available.
High street lenders will only tell you about their products and some brokers only have access to a limited panel of lenders.
Getting independent expert advice from a whole of market mortgage broker will ensure you don’t miss out on a good deal.
Check comparison websites
There are so many mortgage providers on the market it’s difficult to know where to start looking. But before you start walking up and down the high street, spend some time online at a mortgage comparison website.
Use a mortgage calculator
It’s important to know exactly how much you can afford to borrow. Although your provider will talk this over with you, do your own research first so you have a better understanding of what mortgage lenders are looking for in terms of your personal finances.
Use a mortgage calculator to help you establish just how much you’re likely to be able to borrow.
Time is of the essence
Taking out a mortgage is a significant investment. Spend time researching different mortgages, look at the rates, ask friends for their advice and speak to the experts.
You will find the mortgage deal that suits you – it just may not be the first one you come across.
Review your deal
Remember you can change your deal and your lender at a later date, in search of a better deal, if your circumstances change, or following changes in interest rates – although you may incur a penalty.