Making sure you’re on the best mortgage deal is crucial to getting your finances in order. After all, it’s likely to be your biggest monthly outgoing.
There are several ways to find the home loan that’s right for your circumstances at the lowest possible interest rate available.
Here are a few tips to help you find a mortgage that’s right for you:
Doing your own homework
For those confident enough to navigate the mortgage market alone, there’s plenty of help online which allow you to access rates from across the market.
Price comparison sites
On comparison websites, you can find the lowest rates available for the type of mortgage you are looking for - whether it’s a fixed rate, tracker or offset for two, three, five or 10 years. Searching is free and you can do it from the comfort of your own home. However, you won’t get any help with finding the most suitable type of loan for your circumstances by using a comparison site. These websites simply show the rates on offer.
Mortgage eligibility tools
If you want to do some research into the lenders that are likely to offer you the mortgage that you want, try using a mortgage eligibility tool.
By typing in a few details, it will reveal which mortgages you are likely to be accepted for and how much you could borrow, based on lenders’ criteria.
Using this tool will allow you to be more informed when you speak to a mortgage broker for professional advice, which could save you time.
It can also reduce the chance of disappointment further down the line. The Intermediary Mortgage Lenders Association says 64% of brokers believe not fitting a lender’s criteria as a key frustration for consumers.
Getting help from a professional
There are many mortgage deals available, each with a matrix of rates, fees and conditions. With this in mind, you might be tempted to enlist the help of a professional who can organise a search on your behalf. They can help you to find a suitable mortgage based on your needs and personal circumstances - and support you through your application.
At your bank
An adviser at your bank should be able to offer a good indication of what you can borrow as they have your mortgage history at their fingertips. All mortgage advisors are regulated by the financial watchdog, the Financial Conduct Authority (FCA) – and will be required to make sure that the product they recommend to you is suitable for your needs.
However, they can only offer from a narrow range of options as they can only recommend products from the banks’ own range. There may be charges to pay but they will be product related fees – rather than for the advice itself – such as an arrangement fee.
Using a broker
A mortgage broker can search the whole of the market on your behalf. They can also access deals not available directly to borrowers.
Your broker can guide you through the application process and should know what type of applicants a lender will accept. They will also know those lenders which cater for cases such as those with a poor credit history or who are self-employed.
Almost all mortgage brokers are paid a commission by lenders. Some mortgage brokers also charge a fee to their customers for searching for products and for the application process.
Speak to an advisor at fee-free mortgage broker L&C Mortgages
There are a new breed of mortgage advisors emerging – online brokers. They seek to join up the dots by merging product comparison with advice as part of a full online mortgage application. These can be particularly good if you want to manage your mortgage application outside of the normal working day, as you can fill out all your details online before getting a product recommendation.
There are several online brokers already in the marketplace. They all do things a little differently so it’s important to find the one that you’re most comfortable with.
Some questions to ask yourself might be:
Are they “whole of market” – i.e. will they include the largest range of mortgage deals available, giving you the best chance of getting a top deal?
How do they operate and exactly what kind of service do they offer?
What charges might be involved?
Are they registered with the FCA? You can double check here https://register.fca.org.uk/