With thousands of people taking out mortgages each month, it is usually the most significant financial commitment of their lifetime. A home purchase can sometimes mean spending as much as a quarter of your life paying off the loan, so planning properly and getting expert advice to avoid costly mistakes is crucial.
The significant jump in interest rates last year, along with the continued cost-of-living crisis, makes finding sensible solutions more vital than ever. Here are some top tips to help you find the best possible deal.
Shop around
There are thousands of mortgage options on the market, and if you do not shop around, you may miss out on a lower rate or a deal with superior benefits, such as cashback or no fees.
Many people may consider using a comparison website, however, a mortgage broker can search the whole mortgage market on your behalf. They will also conduct a more thorough assessment of your needs and circumstances.
Take expert advice
Choosing the best mortgage involves more than just selecting the lowest rate. Several benefits don't necessarily come with the lowest rate offers but may be more advantageous for your situation, such as flexible overpayments, no early repayment fees, or low and no fee alternatives.
A mortgage broker will talk to you about your goals for the present and the future, find out about your career and family situation, and discuss any concerns you may have about your affordability or credit history. Next, they'll let you know how much you can borrow and how much it will cost you to pay it back each month. They can also facilitate a smoother mortgage application process.
Don’t just go to your bank
Going to the bank or building society you've always banked with can seem like an obvious decision if this is your first time purchasing a home. Similarly, you could be tempted to stay put and accept another loan from your current lender if you already have a mortgage and your deal is due to expire.
There are two potential problems with this. You won't learn about mortgage products from other providers that might be a better fit for your needs and your bank might not be offering the cheapest or most suitable mortgage for your circumstances.
If you’re a remortgage customer and want to switch to a new rate because your old deal is expiring, you can do so online. This may sound very easy, but unlike talking to a broker, you won't get any guidance on other options that might work for your situation, which could end up being quite expensive in the long run.
Be honest
You must be honest with your mortgage adviser and the lender when applying for a mortgage.
Withholding or failing to disclose information may cause a lender to suddenly withdraw the mortgage. Being open during the application process will help them better grasp your situation and provide the appropriate advice for your needs.
