Mortgage Brokers

57
Posted 27th Feb
I'm a first time buyer that will have to partner up with mum to get mortgage.

I don't know whether I should go for an advisor or DIY. A lot of people seem to think it's easy enough doing it here but then others have said go for an advisor who do all the work for you.

Any help would be great please.
Thanks
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Defo explore with a broker because they will see deals which are exclusive however you going DIY may work out cheaper.

Added bonus is you'll get free mortgage advise.
broker all the way - L&C got me some great deals in the pazt
Try technology, check out Habito.
I've seen a lot of bad reviews for L&C.

I assume a lot of people use them considering they don't charge any fees. Is there any way you can use their services and back out if they don't get you the best deal?
I'm a (was) a first time buyer... used the internet to find the best rate at the time for what I kind of repayment I wanted and then compared them between different options/banks etc

In this day and age there is really no need to pay someone to do what you can do online.
Sandeep_Lal27/02/2020 22:15

Is there any way you can use their services and back out if they don't get …Is there any way you can use their services and back out if they don't get you the best deal?


I found them pretty rubbish to be honest - never returned calls when they said they would etc.

I've used a great local company who do all of it for me (visit house when I am available, not when they say etc.) or do it via email / messenger. The biggest thing for me was when my mortgage lender started playing 'funny' over daft things they were the first port of call and could escalate to managers etc. without even bothering me (all to do with my solar panels).

That said, time before, I used a different one and did find a better deal elsewhere via my own bank. They were perfectly happy to just go on their way and not worry over it. Being open and honest with them helped!

As a side note the people I used were facebook.com/Hel…ge/
If I'm borrowing 250k from the bank. Surely it's not a bad thing to pay a fee for e.g £395 I have been quoted and that is only if they secure the mortgage. Otherwise I can walk away if they don't find me a good deal?
Sandeep_Lal27/02/2020 23:20

If I'm borrowing 250k from the bank. Surely it's not a bad thing to pay a …If I'm borrowing 250k from the bank. Surely it's not a bad thing to pay a fee for e.g £395 I have been quoted and that is only if they secure the mortgage. Otherwise I can walk away if they don't find me a good deal?


No need to pay a fee. If you must use a mortgage broker, use one that takes its commission from the bank.
Personally I would go through a broker as generally buying with a relative isn't as easy as people think. Plenty of free ones out there.
Sandeep_Lal27/02/2020 23:20

If I'm borrowing 250k from the bank. Surely it's not a bad thing to pay a …If I'm borrowing 250k from the bank. Surely it's not a bad thing to pay a fee for e.g £395 I have been quoted and that is only if they secure the mortgage. Otherwise I can walk away if they don't find me a good deal?




Just take into account a broker may charge you the £400 fee, but ours heavily guilt tripped us into taking out life insurance which was massively overpriced for something you can get yourself a quarter of the price online. He would have got a nice bit of commission.
As others have said, find a broker that does not charge you a fee. They will get their fee from the lender and usually will explore insurance options with you in order to increase their fee. You aren't obligated to take out the insurance so use it as a benchmark to find your own policy away from your meeting. Usually it'll be much cheaper but be sure it adequately protects you.

You want a whole of market broker who can find you the very best possible deal. Not one tied to specific lenders.
Money supermarket do mortgages with another company and no fees
i would just do it myself. you only need a broker if you struggle to get a mortgage from the bank.
If you go through a broker, even if they don't charge you a fee directly the lender pays them and will add it on to your deal so you will pay one way or another. They will also try and sell you other products that they get commission for too. Just remember that they don't work for free.

'd say use the comparison websites or contact lenders directly (I was with Nationwide for years, they had good rates and were easy to deal with). It's very easy to compare mortgages using the APRC figure, they aren't a complicated product (just a big loan secured against your property) but with rates so low there isn't much difference between them right now so your first issue is getting a deposit and the having the ability to pay.

Brokers are useful if you have a bad credit score or are self-employed etc when things might be a bit more tricky.
tallpete3328/02/2020 11:38

If you go through a broker, even if they don't charge you a fee directly …If you go through a broker, even if they don't charge you a fee directly the lender pays them and will add it on to your deal so you will pay one way or another. They will also try and sell you other products that they get commission for too. Just remember that they don't work for free.'d say use the comparison websites or contact lenders directly (I was with Nationwide for years, they had good rates and were easy to deal with). It's very easy to compare mortgages using the APRC figure, they aren't a complicated product (just a big loan secured against your property) but with rates so low there isn't much difference between them right now so your first issue is getting a deposit and the having the ability to pay. Brokers are useful if you have a bad credit score or are self-employed etc when things might be a bit more tricky.


I have a deposit of 75k. I'm looking to buy a 2 bed for around 325k (Could be cheaper could be more)

IMO that seems like a hefty deposit which should hold me in good stead?

It would be great if I could get the whole mortgage on my own meaning I don't have to pay stamp duty of 5k but I have a feeling I will need a second person on the mortgage to help me get that extra bit.

I'll contact the broker see what he can do and I'll do my own research. If he can't beat mine then I should just do it on my own.

Edit: What does the APRC figure mean?
Edited by: "Sandeep_Lal" 28th Feb
Sandeep_Lal28/02/2020 15:48

I have a deposit of 75k. I'm looking to buy a 2 bed for around 325k (Could …I have a deposit of 75k. I'm looking to buy a 2 bed for around 325k (Could be cheaper could be more)IMO that seems like a hefty deposit which should hold me in good stead?It would be great if I could get the whole mortgage on my own meaning I don't have to pay stamp duty of 5k but I have a feeling I will need a second person on the mortgage to help me get that extra bit.I'll contact the broker see what he can do and I'll do my own research. If he can't beat mine then I should just do it on my own.Edit: What does the APRC figure mean?



That's a good deposit but the banks will also need to see you can service the £250k mortgage so you will need proof of earnings and outgoings etc.

APRC is the overall coat of the mortgage (if it runs it full term). More info here
tallpete3328/02/2020 16:05

That's a good deposit but the banks will also need to see you can service …That's a good deposit but the banks will also need to see you can service the £250k mortgage so you will need proof of earnings and outgoings etc.APRC is the overall coat of the mortgage (if it runs it full term). More info here

When a mortgage period ends e.g 5 year fixed. do people always remortgage?

are there hefty fees involve to switch?
Also the second person who will be my mum is 57. Could this affect the mortgage? She already owns 1 property in London so my guess is the banks will see her as a good person to lend to.
Sandeep_Lal28/02/2020 16:20

When a mortgage period ends e.g 5 year fixed. do people always …When a mortgage period ends e.g 5 year fixed. do people always remortgage?are there hefty fees involve to switch?


It's always worth shopping around, same as car insurance or broadband etc. You pay no exit fees once your term has ended. The amount they will lend depends on your earnings but they are unlikely to lend long term to your mum because of her age. Best get an appointment with your local bank to discuss further
Sandeep_Lal28/02/2020 16:23

Also the second person who will be my mum is 57. Could this affect the …Also the second person who will be my mum is 57. Could this affect the mortgage? She already owns 1 property in London so my guess is the banks will see her as a good person to lend to.


Unsure but do you mean have you're mum as a guarantor, because otherwise you(you're mom) could be hit by SDLT for a second home, I think

Also if the term of the mortgage is say 20 years, they may say your mom won't be working at that point, therefore unable to fund a mortgage

Re; you're other post, yep everyone remortgages with the aim of getting a better rate

I may have missed something as didnt read all the posts
Edited by: "sidhoooooo" 28th Feb
sidhoooooo28/02/2020 17:17

Unsure but do you mean have you're mum as a guarantor, because otherwise …Unsure but do you mean have you're mum as a guarantor, because otherwise you(you're mom) could be hit by SDLT for a second home, I thinkAlso if the term of the mortgage is say 20 years, they may say your mom won't be working at that point, therefore unable to fund a mortgageRe; you're other post, yep everyone remortgages with the aim of getting a better rateI may have missed something as didnt read all the posts


Thinking of having mum on the mortgage so joint owner. She doesn't earn a lot but I won't be able to secure the property on my own.

Either way I will be hit with SDLT no? I've worked it out to be 5k which for me is a lot.
Sandeep_Lal28/02/2020 17:43

Thinking of having mum on the mortgage so joint owner. She doesn't earn a …Thinking of having mum on the mortgage so joint owner. She doesn't earn a lot but I won't be able to secure the property on my own.Either way I will be hit with SDLT no? I've worked it out to be 5k which for me is a lot.



Sandeep_Lal28/02/2020 17:43

Thinking of having mum on the mortgage so joint owner. She doesn't earn a …Thinking of having mum on the mortgage so joint owner. She doesn't earn a lot but I won't be able to secure the property on my own.Either way I will be hit with SDLT no? I've worked it out to be 5k which for me is a lot.


Might want to recheck that as a joint owner, your mom would have a second property therefire additional 3% stamp duty would apply, for your 250k property, just tried an online calc you're looking at 10k
Edited by: "sidhoooooo" 28th Feb
Guarantor route would not get the additional 3%
Sandeep_Lal27/02/2020 23:20

If I'm borrowing 250k from the bank. Surely it's not a bad thing to pay a …If I'm borrowing 250k from the bank. Surely it's not a bad thing to pay a fee for e.g £395 I have been quoted and that is only if they secure the mortgage. Otherwise I can walk away if they don't find me a good deal?


Brokers earn fees from lenders, and that fee needs to be transparent. When you hear what they are earning from the lender you may not be so blasé about the £395 fee. In today's world there should be no real reason to be paying a broker fee unless you were looking at the sub-prime sector. I can recommend a broker if you want, there's no need for a broker to be in your local area
sidhoooooo28/02/2020 20:59

Might want to recheck that as a joint owner, your mom would have a second …Might want to recheck that as a joint owner, your mom would have a second property therefire additional 3% stamp duty would apply, for your 250k property, just tried an online calc you're looking at 10k


I did a calc online and SD came to 6250 to buy a second home.
sidhoooooo28/02/2020 21:02

Guarantor route would not get the additional 3%


Could you explain that a bit more?
Maybe I should summarise a bit better my situation.

I am a first time buyer my salary is 48k. Houses I'm looking at are anywhere between £300-325k.

I have a 75k deposit. Based on my salary alone I don't think I can get the mortgage - which is why I thought it would be best to add a second person to the mortgage but the repercussion of this seems to be a considerable amount of stamp duty.
If you mom was a guarantor means if you don't pay then they will come after you're mom for any outstanding debt.
But the extra 3% stamp duty would not apply as you're mom would not be the joint owner, as you said earlier your mom would be the joint owner
On a 300k property the stamp duty for someone purchasing a second property would 14k, plenty of online calcs to check with
sidhoooooo28/02/2020 23:12

On a 300k property the stamp duty for someone purchasing a second property …On a 300k property the stamp duty for someone purchasing a second property would 14k, plenty of online calcs to check with


Yep did the checks again. I was not aware about the second home stamp duty and that's thrown a spanner in the works. Thanks for pointing this out. I would rather sacrifice getting something cheaper than paying 14k/16k whatever it may be.

Looks like I'm left with going solo and perhaps keeping my budget at 300k max.

I'm in the process of closing my ltd business (was self employed) and I'm starting a new job in a couple of weeks.

After 3 months of payslips I'll probably start the process.

Is there anything in my circumstances to believe that I may have difficulty as in I should get an advisor and pay them a fee.
jase.227/02/2020 21:52

broker all the way - L&C got me some great deals in the pazt


Definitely second that, L&C are excellent.
I had a look around myself to see what I could but then rang a broker as well which I was recommended.

The guy was excellent, he really helped with various queries and questions not only about the mortgage but odd question I had about properties as well.

The mortgage he found us was cheaper than any I could find, he had a fee unless you took out the mortgage through him as well as life insurance for first couple of years.

When it came to the end of our 2 year term last November he'd already done his basic homework before ringing me up to tell me our term is about to finish and what options we would have.

I told him a slight change in circumstances and he went off and looked again based on them. This time when he came back what he found was the same I was able to find but he took away all the hassle of paperwork etc so used him again.
Sandeep_Lal29/02/2020 00:10

Yep did the checks again. I was not aware about the second home stamp duty …Yep did the checks again. I was not aware about the second home stamp duty and that's thrown a spanner in the works. Thanks for pointing this out. I would rather sacrifice getting something cheaper than paying 14k/16k whatever it may be.Looks like I'm left with going solo and perhaps keeping my budget at 300k max.I'm in the process of closing my ltd business (was self employed) and I'm starting a new job in a couple of weeks. After 3 months of payslips I'll probably start the process. Is there anything in my circumstances to believe that I may have difficulty as in I should get an advisor and pay them a fee.


If you are beginning to work shortly then and have 3 months pay slips, alongside good credit history, go online find the cheapest rate that suits you considering any set up fees, and start the process
Do the figures between agreement and principal and actual offer differ much?
I don't see that going to a free broker can do any harm in conjunction with internet comparison sites. I got quoted a fee from one broker and it was easy getting them to waive their fee. I just said I was looking for non fee and wouldn't pay a fee.
Sandeep_Lal01/03/2020 00:16

Do the figures between agreement and principal and actual offer differ …Do the figures between agreement and principal and actual offer differ much?


I'm sure there will be someone else that can give you a definite answer but the as far I know the Agreement in Principal is given over the mortgage amount you want, they won't change it after that and if you decide you want to go for a more expensive property they will then agree to that value.

As above not 100% certain on that as we bought a house with the value of the initial agreement in principal which we had but that's my understanding
Sandeep_Lal28/02/2020 22:07

Maybe I should summarise a bit better my situation.I am a first time buyer …Maybe I should summarise a bit better my situation.I am a first time buyer my salary is 48k. Houses I'm looking at are anywhere between £300-325k.I have a 75k deposit. Based on my salary alone I don't think I can get the mortgage - which is why I thought it would be best to add a second person to the mortgage but the repercussion of this seems to be a considerable amount of stamp duty.


A quick look shows that the repayments on a £250k mortgage are probably going to be around £1300/1400 a month after introductory periods (assuming a typical 25 year term). That won't leave much out of your take home pay from £48k gross. Bearing in mind that interest rates are really low at the moment, be very mindful that you don't over commit.
Edited by: "deeky" 3rd Mar
deleted8085803/03/2020 08:21

A quick look shows that the repayments on a £250k mortgage are probably …A quick look shows that the repayments on a £250k mortgage are probably going to be around £1300/1400 a month after introductory periods (assuming a typical 25 year term). That won't leave much out of your take home pay from £48k gross. Bearing in mind that interest rates are really low at the moment, be very mindful that you don't over commit.


I can remortgage after the introductory period no?
Sandeep_Lal03/03/2020 13:53

I can remortgage after the introductory period no?


Yes you can, however the interest rates may have risen, and other lenders may have better deals but might have an admin fee of say £995 on top. I find that often staying with the original lender is better as any fees are added to the loan amount, so I don’t have to pay the £995 up front. Also new lenders may ask for up to date payslips etc, whereas t(e original lender will just roll your mortgage over to a new deal. As others have said, using a broker will benefit you now and when the fixed term deal is coming to the end. My broker gets commission from the lender and if asked, will show you how much commission they will earn.
Personally, I managed to get a deal with my own bank that was only £5 dearer a month than the best price from the broker.

I stayed with my own choice as it was my current bank, so I didn't have to trek all the way into the city for a branch, and for the sake of £5 it was a lot less hassle.

You'd be surprised how cheap you can find it yourself just browsing bank sites and comparison sites.
sammy12503/03/2020 15:31

Personally, I managed to get a deal with my own bank that was only £5 …Personally, I managed to get a deal with my own bank that was only £5 dearer a month than the best price from the broker.I stayed with my own choice as it was my current bank, so I didn't have to trek all the way into the city for a branch, and for the sake of £5 it was a lot less hassle.You'd be surprised how cheap you can find it yourself just browsing bank sites and comparison sites.


If going on your own, the broker obviously doesn't take a fee. How does that saving benefit you when going direct?
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