Getting the best mortgage deal could help save you money, but how do you know you’re choosing the right one? We’ve put together a list of steps to help you find the right mortgage deal for you.
1. Make yourself attractive to lenders
First things first, ensure you are in a good position financially. As you would expect, lenders like stability. Make sure you are on the electoral roll and check your credit file to ensure everything is in order. Make regular, on-time payments for your credit card, and if you can, don’t switch jobs until the mortgage process has been completed.
2. Work out which type of mortgage you want
Repayment or interest-only?
Choosing interest-only means you must have another plan to pay off your debt, whereas choosing a repayment mortgage will cost more, but will also pay off the original debt. A repayment mortgage is easier to get, as with interest-only, lenders are likely to limit the amount you can borrow and will require evidence of a credible repayment plan.
Fixed or variable?
With a fixed rate, you can rest easy knowing exactly how much you will be repaying for that set time. Variable rates adjust periodically, therefore your monthly payments may change each month, and there is no guarantee whether they will increase or decrease.
3. Get an idea of the rates available
The rates available to you depend on the size of your deposit and the value of the property you want to purchase. There are thousands of mortgage products available, so instead of just going straight to your bank first, it’s a good idea to use price comparison sites to find a deal that fits your requirements and capabilities.
4. Speak to a mortgage broker
Once you’ve seen what rates are on the market, speak to a mortgage broker, preferably one that has been recommended by someone you know, and see what they can offer you. It’s worth using a broker, as they know the ins and outs of lenders’ criteria. So for example, if a lender doesn’t lend on properties in council blocks, they will be able to point you in the direction of a lender that will, saving you time and hassle.
5. Check the paperwork, and check it again
Once you’ve found a suitable deal and have been sent your mortgage offer, you’ll need to ensure you read it through and check every detail is 100% correct. Spelling mistakes in your name or incorrect figures could cause delays, extra expenses, and could result in you losing your offer completely.
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