Finding a suitable mortgage

The world of mortgages has become something of a minefield in recent years, with more and more lenders offering an increasingly confusing range of mortgage products. For the first time buyer, or those that know little about mortgages, the whole process of getting a mortgage – and getting the right mortgage – can be extremely stressful and difficult. However, there are certain steps that you can take to make sure that you don’t end up with the wrong mortgage, and to enable you to get all the professional help possible.

A mortgage is a long term, important, and huge commitment, and it is important to remember that if you default on your mortgage loan you are at risk of losing your home. Most people that have had little to do with mortgages in the past will find the whole process overwhelming, and because of this many people tend to simply settle for whatever they are pushed into by persuasive sales staff – and this isn’t always something that will be in the best interests of the buyer. Although house hunting and getting a mortgage is never going to be a totally stress free experience for most people, there are ways of reducing the hassles associated with this process.

Get your mortgage before you look for a home

Most people tend to look around for a property, and then once they have found one they apply for a mortgage. However, it can be extremely disappointing to find the perfect home only to find that you cannot get a mortgage for the amount that is needed. It is therefore a good idea to apply for a mortgage first, as this will enable you to find out how much you can borrow and whether you have a definite mortgage offer. By doing this you can look at properties that you know are within your price range rather than wasting time viewing properties that you won’t be able to get a mortgage for. It will also give you the upper hand if you find the perfect property, as most sellers will give preference to those that have already been approved for a mortgage in the event that there is more than one offer for the asking price.

Shop around

When you are looking for a mortgage it is extremely important to compare different lenders as well as different products, as you will find huge differences when it comes to interest rates, special deals, etc. Comparing mortgages and interest rates can save you a fortune over the term of your loan, so it is definitely worth spending some time looking at different products.

Go through a broker

A broker has access to a range of mortgage lenders, and as he or she will have worked with these lenders on a long term basis, will have built up a rapport and will know which lender is likely to be most suited to you based on your circumstances. If you have a bad credit rating it is particularly important to use a broker, as if you make your own applications to a variety of lenders – lenders that may not even cater for those with bad credit – you will further damage your credit, and further reduce the chances of getting a mortgage at all. A good broker will know which lenders are most likely to accept you under the circumstances, and can therefore avoid damaging your credit through making unsuitable applications that may be rejected.

Pay for your financial advice

In many cases financial advisers are used to help consumers find the right mortgage, and often these advisers are paid by whichever lender you go through. However, many people worry that the adviser will direct them towards the mortgage lender that offers the highest commission rather than one that best suits them. The way around this is to pay for the financial advice yourself rather than getting an adviser that operates on commission from lenders. This way you will no that the adviser is completely objective and will recommend a suitable product with your best interests at heart – it could save you a fortune over the longer term.

Remember to shop around for your payment protection

Having payment protection cover in place is very important when you are taking out a mortgage, as if anything unexpected happens – such as redundancy, illness, or an accident – you want to know that your repayments are covered long enough for you to get back on your feet. However, do bear in mind that the cost of this cover can vary from one provider to another, and you do not have to necessarily take this cover from your mortgage lender. Take the time to shop around and compare premiums for this cover, as there are significant differences in price so you could save a packet.