Choosing a Mortgage
A house is the biggest purchase most of us will make. So sorting out a mortgage quite early on in the process of buying a home is most defiantly a priority. Having your mortgage ready to go will make a lot of difference when you are bidding on a property. Having a mortgage in place will signal to the seller that you are ready to move and serious about it too!
Most mortgage lenders will let you know that they are willing to offer you a mortgage up to a certain level as you start looking; this is called a mortgage in principal and will depend on your income? The application is finalized upon deciding which house you want to buy. However, it is still possible to sort it all out once your offer has been accepted.
The total amount of revenue you are allowed will depend on your income, who you are buying a home with (if you are buying a home alone then this is self-explanatory,) a partner, friend or an associate. These factors will all contribute to the amount you can borrow.
There are a number of ways to find a mortgage. The two best and well-known ways are, Direct through a bank or building a society, or a mortgage broker. These two ways can be done either, over the phone, on the internet, and in person. As this is probably the largest purchase of your life, I do like to speak to someone face to face, this way you can ask as many questions as you see fit.
Some people feel safe and more comfortable obtaining a mortgage from a high street name, and also find it convenient to have their mortgage with the same bank they have their other financial dealings with e.g. Direct debits and personal accounts. Alternatively, going through a mortgage broker does ensure you get a choice of a wider range of mortgage products and deals.
There are thousands of mortgage products to choose from, and the market can get very confusing. Do a little research before you decide to take out a mortgage and find the best one that is suitable for you. Have a think about what you find would be the most appropriate mortgage suited to you:
• Would you like to take 'payment holidays' if your financial circumstances change i.e. you need some holiday spending money, or some extra Christmas money, or alternatively pay off extra if you have more money at the end of the month?
• Cashback incentives mortgage offers you an extra cash sum when you take it out. This way you can use your cash incentives to pay for any household peripherals you may need or you may use the incentive for solicitor’s fees.
• The interest rate on the mortgage is guaranteed to be fixed for a period of time? This is a safe bet if you manage your funds on a monthly basis and like to know exactly what is to come out of your account. When you come to make your decision, always review the mortgage code. The mortgage code sets out minimum standards that mortgage lenders and intermediaries have to meet.