Many of us know that it is important to consult a mortgage broker when looking to maximise your earnings and invest the right way. We listed a few crucial questions you should be asking, in order to find out how much you can afford to borrow and find your ideal investment sooner.
The sensible approach when looking for a mortgage is to use a recommended mortgage broker. This can save you time and money. Do remember though that an independent broker is best as they will search the whole market and have many relationships that can help you navigate the many various options there are out there and find a mortgage solution that is ideal for you. Whether you are a first time buyer or a seasoned letting professional, getting a good mortgage broker is essential. Their costs are minimal and they can help you save 100’s if not 1,000’s of pounds every year.
1. How do you charge for your services? Fees or commission, or a combination?
It is important to establish how a mortgage broker will charge, so you can be sure to allocate some funds and know what you are getting into beforehand.
Typically, a good mortgage adviser will charge you a fixed fee to engage with you and find the best deal for you. There are some out there that work more on a commission basis once they have found you a mortgage, but it is our opinion that to get a good mortgage adviser to engage with you paying a one-off fee is the best approach.
All mortgage advisers will also get paid directly by a mortgage provider and that commission will have no impact on your rates, typically a fee of 0.3%-0.5% is earned per deal. The rates can go as high as 1.5%, but these tend to be for specialist type deals. So the straight forward answer is a combination.
2. Can you give me a breakdown of your costs?
Most mortgage advisers should happily give you a breakdown in costs, but what I can say paying for a good mortgage adviser will not only save you time, it will definitely help you achieve the best deal for you, so spending a little upfront to get a broker engaged is recommended.
3. Are you independent and able to cover the whole mortgage market?
Independent brokers are able to draw on the whole market, yes. What typically happens is that an independent will basically join networks that exist out there that secure deals on behalf of many mortgage advisers, and by pooling their buying power are able to get the best deals for their clients.
4. What qualifications do you have?
Mortgage advisers will have to take professional qualifications and should have them displayed for you. Typically these will be something like or similar to CeMAP or a Certificate in Mortgage advice from various professional bodies.
5. How long will it take to arrange my mortgage?
The simple answer is a standard offering from form to offer should take around 6-8 weeks. This can indeed be quicker if you are familiar with the property market and have done this many times before with a good relationship in place, but equally can take longer if you are a non-resident or have circumstances that may mean they take longer to process your request.
6. What deposit will I need?
Normally and industry standard suggests that 25% is the minimal requirement for BTL mortgage, for residential most work on 10% basis. What we suggest is that 10% for residential buyers is key and helps you secure a good deal, as for BTL investors we often tell our clients that work on a 30% basis as tends to avoid disappointment.
7. Will you offer guidance throughout the whole mortgage process?
Absolutely, mortgage advisers are there for the entirety of the process as many will only get paid commission by the provider once the mortgage is completed with your purchase, so their motivation to stay engaged is high.
For more information, call us on 0207 183 0646 to speak to a member of our team. Alternatively, to book a free mortgage consultation with us, click here.