Are you thinking about buying your first home?
When it comes to getting on to the property ladder, there’s so much information available that it can seem a bit overwhelming. I regularly get enquires from people who just don’t know where to start!
The first thing we need to do is have a chat and work out what you want to achieve.
1. Let’s work out what you can afford
When it comes to buying a property, lenders need to know that you will be able to afford to repay the borrowed money. To work this out they will conduct what is known as an “Affordability Assessment” They will assess your current income and outgoings and look at your credit history to decide how much you can borrow in the form of a mortgage.
As part of my service I will gather all the relevant information from you and work out how much each lender will allow you to borrow. As there are so many lenders available this can take a few days, so it is crucial that we get all your relevant information and documentation together as soon as possible.
2. What price bracket can I look in?
Once I have confirmed how much you can borrow, and we add that figure to your deposit we will know what price bracket you can start looking at.
In terms of deposits, you will need at least 5% of the purchase price as a minimum. The bigger the deposit you have the less money you need to borrow in the form of a mortgage and therefore the cheaper the rate of interest the lenders will offer you.
There are government schemes that can help boost your deposit savings, Help-2-Buy ISA and Lifetime ISA’s are fairly popular as the government will top up your savings in the way of a 25% bonus. Again, this is something we can speak about in more detail if your not quite at the 5% deposit figure required.
3. Getting you the best deal
Now you know how much you can borrow, and you’ve got your deposit saved, the next step is to find a property that you like and submit an offer. From here I will then speak to the cheapest lender that meets your affordability and ask them to provide us with a Decision in Principle. This is an outline document confirming that the lender is happy to take you on as a customer.
4. Sending the paperwork
From there a copy of the Decision in Principle along with proof of your deposit is normally required to be sent to the estate agent selling the property, I can help you with this.
I will then submit your Full Mortgage Application and send the lender a copy of the documents that we gathered during our initial meeting.
5. Official offer
The lender will then instruct an independent valuation surveyor to carry out a mortgage valuation survey on the property. If the survey comes back positive, then the lender will issue us with the Official Mortgage Offer.
We will both receive a copy of this and so will your chosen solicitor. It is then down to the solicitor to complete the necessary legal work and arrange for a completion date for you to get the keys to your new home!
Most lenders will offer you a mortgage that has some sort of fixed rate period attached to it, it may be for 2, 3, 5 or even 10 years. At the end of this period it is likely that you will revert onto your lender’s Standard Variable Rate (SVR), which is their most expensive rate. If you take a little time to look for a better rate, you could save a significant amount.
In order to do this, you’ll want to start looking to re-mortgage and this is something I can help you with.
Most lenders will offer you a mortgage that has some sort of fixed-rate period attached to it; this may be for two, three, five or even ten years. At the end of this period, it’s likely that your mortgage will go on to your lender’s standard variable rate (SVR), which is their most expensive rate. By switching on to a new deal, you could save a significant amount of money over the remaining term of your mortgage.
In order to do this, you’ll need to remortgage, and this is something I can help you with.
The best remortgage plan for you
Just like when buying the property, we will meet up and work out what your plans are for the coming years. From there we can decide on the best course of action for you. It may be to look at a new 2-year fixed rate product or if you are settled in your home and don’t envisage moving anytime soon, we can look at longer fixed rate periods.
There are also other products that may suit your circumstances such as offset mortgages, tracker mortgages and discount rate mortgages. I can take you through these in detail and we can then decide if any of them are suited to you and your future plans.
As with buying your first property, we will go through the mortgage process again. I will search the market to find out which lender is going to offer you the best deal based on your “Affordability Assessment” and their lending criteria.
Decision in principle straight to mortgage offer
Once we have selected your ideal mortgage, I will submit the Decision in Principle, however this time as there isn’t an estate agent involved so we can go from there straight to the Full Mortgage Application.
The lender will then instruct the valuation survey and once they are happy with the survey, they will issue us with the Official Mortgage Offer. The solicitors then pick up the paperwork and arrange all the relevant legal work. Once the work has completed your existing mortgage stops and your new mortgage starts.
Remortgage deadline alert
As part of the service I offer, I will keep a note of your mortgage dates and rather than you having to worry about when your current deal ends, I will be in touch a few months before to let you know it is coming up. This gives us time to arrange a meeting and get everything in place so we can switch from one mortgage product to another smoothly.
‘I always aim to make the process as simple as I can for you by doing all the work on your behalf where possible. Like the managing agent in my buy-to-let section, you’re an expert at what you do, so why stop that to get involved with something that isn’t your daily business?
Leave that to me!’