First Time Buyers - Mortgage Q & A



Question:


I want to get on to the property ladder and purchase my first home and not sure where to start. Do I need a mortgage agreement in principle?


Answer:


Firstly, get friends and/or family to recommend an Independent Mortgage Adviser that they have used or look for someone within your local area that has testimonials on their webpage. You can then speak with them and they can tell you how a mortgage works and what your potential lend would be from any of the financial institutions available. They will also have access to the whole of the marketplace and they will be able to source who will lend to you and what they will lend. If you have any questions always ask.


Question:


I have not checked my Credit File recently, should I do this and if so, what’s the best provider to use as there are many companies offering free credit reports? OR would an Independent Broker do this for me?


Answer:


It would be a good idea to check your Credit File before you start looking at mortgages. This will give you an idea of how good or bad your credit rating is. If the rating is not as good as it could be there are certain things you can do to improve this, such as, paying more into a credit card if you can, close any credit cards you do not use(the credit limit, even if you are not using it can affect your rating). You can use Experian, Equifax or Noddle online to check your rating. It can be free or have a small fee but definitely worth doing. Independent Brokers would not do this for you but can tell you where to go.


Question:


To get a Mortgage in Principle does a broker need copies of my payslips and ID or is this only when it goes to application stage?


Answer:


When doing a Decision in Principle, payslips/bank statements confirming income are a definite as you need to be as accurate as possible to ensure the Full Application will go through. You will also need a Passport or Driving License.


Question:


I have heard most Banks offer 90 and 95% mortgages only, is this true?


Answer:


This is true but some banks are offering 100% mortgages if relatives and friends give a deposit of 10% that sits in a bank account for a specified amount of time before it is given back.


Question:


What size of deposit do I need? Is it ok for parents to gift this money to me?


Answer:


The more deposit you have the better, the interest rates offered depend on the loan to value so you will get a better rate if you have a 20% deposit instead of 10%. Parents can gift money, it may have some inheritance tax implications in the future so they should always get independent legal advice.


Question:


How much do I need to pay a broker to organise my mortgage?


Answer:


Each Mortgage Broker is different but it is normal to charge a fee. The amount may depend on the complexity of the mortgage. An Independent Mortgage Broker/Adviser has the whole of the marketplace and will be able to get you the best deal and will give you a more bespoke service than going directly to one bank. An Independent relies on word of mouth for future business so they should always go the extra mile.


Question:


Is it better for me to use an Independent Broker or just go to my bank?


Answer:


Your bank can offer you their products with their rates but an Independent Mortgage Adviser will cover the whole of the market to ensure you get the best deal possible. We also have access to Exclusive products that are only available to the Intermediary Market and not available in High Street Branches.


For any mortgage related queries, contact :-


Claire Walsh, Independent Mortgage Adviser, CW Mortgages,

E-mail: Claire@cwmortgages.co.uk



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