“A legal agreement by which a bank, building society, etc. lends money at a pre-determined interest rate secured against the debtor’s property, on the understanding that the conveyance of title becomes void upon the repayment of the debt”
Most people, when they buy a property, have to borrow some money. Known as a residential, or ‘owner-occupier’ mortgage, these are long-term loans typically provided by bank or building societies, which are secured against the property itself.
The capital sum borrowed, and any accrued interest are repaid over an agreed fixed ‘term’ which has traditionally been over 25 years or up to state retirement age. However, with new restrictive lending and affordability criteria, many mortgages are taken for up to 40 years to keep repayments low. While more ageist criteria is impinging on older borrowers even getting mortgages.
In today’s environment, where there is once more an ever-increasing number of products offered by a wide variety of lenders, these choices, and the compliance regime, can seem daunting.
There are the usual questions, such as the type of loan you should go for — fixed, tracker, flexible etc. In the current market, lenders are far stricter with their lending criteria and it has become increasingly more difficult to obtain acceptance, and a mortgage offer from the preferred lender.
Most residential mortgage providers now require a minimum deposit of at least 10% of the total value of the property, although some lenders are once again lending at 95% Loan-To-Value, (LTV). The most economic products, however, are available for those borrowing 60% LTV or less, with the rate rising gradually as the borrowing increases for each 5% increase in borrowing.
Your credit history, alongside your income, or joint incomes, will have an influence on your ability to obtain a mortgage.
The inception of the Mortgage Market Review (MMR) means that affordability is the main criterion by which Lenders calculate your level of borrowing.
Everyone should want their residential mortgage to be at a competitive interest rate, but also have a product that suits their lifestyle and needs. For example, if their income fluctuates from month to month, or they receive hefty annual bonuses, a flexible mortgage will allow payments to fluctuate according to their variable income.
Those who prefer to know exactly what their mortgage payments will be from one month to the next are better suited to a fixed rate mortgage, as this provides a predetermined monthly payment for the term of the fixed rate contract.
For those of you that are confident that the current interest rates will not fluctuate significantly for some time, then you might opt for a tracker mortgage that will follow the Bank of England Base Rate.
Choice is the wonderful, but it is also the problematic as there are so many different mortgage providers offering hundreds of products, which can make identifying the most appropriate mortgage extremely difficult.
The knowledge and contacts of a mortgage broker, such as One Stop Finance, can be the difference between getting the right mortgage or being unable to obtain a mortgage. As part of the Quilter network, we have access to exclusive products which aren’t available on the high street, which can make a real difference.
It is important for people who are coming towards the end of their initial mortgage term and facing the prospect of reverting to a higher variable rate to be guided correctly.
For anyone looking at a larger than average mortgage, One Stop Finance’s consultants have many years’ experience in the high-net-worth arena and are able to offer bespoke advice, which can be made to fit your unique requirements. For everyone, time is a valuable and precious commodity and we all lead busy lives,
One Stop Finance understand this and provide a service where we co-ordinate the entire mortgage process on your behalf, maintaining control over the application from start to finish.
In addition, our stated policy of transparency means our clients are made aware of the fees that we charge them for our advice and recommendation service and any procuration fees we may be paid for introducing them to the lender.
Rest assured that the exceptional consultants and support staff at One Stop Finance guarantee a level of service that is second to none.
One Stop Finance is a mortgage broker who offers a whole of market service; whether that is High Street lenders, broker only lenders, Private Banks, Offshore lenders, small building societies or specialist loan providers.
All our professional advisers are here to act for you, first and foremost, to help you choose the most suitable mortgage, and guide you through the process with ease.
Our Advisers and support staff are here to help smooth process from start to finish.
For more information please call us on 020 8441 2605 or or 01442 232 272. Alternatively click here for our enquiry form.