Where can you find a good mortgage deal; should you fix or go for a tracker mortgage and is now the time to trade up? These are all questions we're being asked constantly. Here are a few answers from our expert.
By Kate Faulkner
Trying to find a mortgage at the moment can be a tricky affair. A few years ago there were lots of mortgages to choose from, now fewer companies are offering fewer mortgages and the cost of the mortgage and deposit required have rocketed. So how do you find out about good deals?
Most mortgages which have an attractive interest rate at the moment require a 25% deposit. However you can still get mortgages that only require a 5 to 10% deposit, it’s just that you typically pay a higher interest rate AND the mortgage fees might be as much as 2.5% of the property’s value. So if you are buying at £135,000 x 2.5% you have to pay an over £3,000 just to arrange the mortgage.
To find the right mortgage deal for you, you really need to talk to an Independent Financial Advisor (IFA) who can search ‘whole of market’. This means that they are not ‘tied’ to any lenders and can check all types of mortgages to find the right deal for you.
An IFA would take into account all your finances from your salary to any commission, check out what insurance or pension provision you have and work out how big a mortgage you can afford.
However, some banks and building societies don’t deal with IFA’s anymore to avoid paying them commission. So, once you have some ideas of mortgage rates and the associated charges (booking or admin fee and mortgage valuation costs) from your IFA, you need to check whether a high street lender or mortgage broker could offer you a better deal.
Mortgage information from 4Homes
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