Choosing the right mortgage is a vital step in buying a new home. It is crucial to understand the process and terminology to ensure that you make the right decision before signing on the dotted line.
So, what do you need to know?
First thing’s, first
Before you begin your hunt for your dream home, it is recommended that you get pre-approved for a mortgage and apply for a mortgage in principle. This helps you to understand how much you could borrow and gives you a better idea of what you can afford in your house search. This is often the first step in the house buying process.
Understanding
Ensure you understand the terms of the mortgage loan, including the interest rate, the monthly cost and payment schedule and any penalties for overpayment. If you need help with this, we have a fantastic mortgage advisor, Savannah Banks-Gould at our George Street office who would be delighted to help.
Fixed or variable?
If you want to know exactly how much your mortgage payments will be each month, you need a fixed rate mortgage deal. No matter if interest rates rise or fall, your payments stay the same throughout the duration of your deal.
With a variable rate mortgage, your monthly payments can increase and decrease according to interest rates. This usually fluctuates to match the Bank of England base rate.
You will also be asked if you want an interest only mortgage or a repayment mortgage. With a repayment mortgage, each of your payments goes to paying off the debt as well as the interest. With interest only, you are only paying for the interest on the loan.
How long does it take?
It can take as little as 24 hours and up to six weeks for a mortgage to be approved. If you use a mortgage broker it may be quicker as they can chase the application regularly on your behalf.
Ask the experts
It is a good idea to ask a mortgage broker for assistance when buying a new home as they are able to compare rates and terms from multiple lenders and find you the perfect deal to suit you and your family. Our mortgage advisor Savannah is part of the LionHart Mortgage Solutions broker team.
Get in touch with our team today on 01536 261666 or pop in and see us at our George Street office.
