Getting financial advice prior to applying for a mortgage is essential in today’s housing market and it could be the difference between being accepted or rejected.
Mortgages can be confusing because there is different interest rates, repayment plans and jargon which can make the mind boggle.
A financial advisor can cut through the legal wording and make the entire process easy to understand and manageable. Your financial expert will also be able to help you write a will too.
Applying For A Mortgage
Prior to the credit crunch almost anyone could get a mortgage, without even needing financial advice. Mortgages were being approved for 110% value of the property which meant no deposit was necessary and you would get a little extra money on top.
Now it’s much harder to be approved for a mortgage and the average borrower will need to pay a minimum 25% deposit.
The criteria to being accepted for a mortgage has also got stricter with most lenders wanting greater assurances the loan with be repaid.
Types of Mortgage Repayments
Interest only Mortgage
You will only pay the interest on your mortgage each month but not of the loan will be repaid and will still be outstanding at the end of the term.
This can be a good mortgage for someone who is expecting to come into money or is going to be able to repay the full amount at the end of the term.
Capital and Interest Mortgage
The typical repayment method of mortgage customers is capital and Interest, although payments will be higher.
This method will mean you’ll repay the mortgage and the interest but won’t have a large sum to repay at the end of the term.
Help Getting A Mortgage
Banks, building societies and other mortgage providers will use a range of different factors to determine whether to approve your mortgage application.
Lenders will take your income, expenditure, credit rating and much more into account when accessing the risk in approving your application.
A mortgage advisor will be able to tell you what lenders will want and whether you are likely to be approved before you apply.
It can be the difference between having your mortgage application rejected or approved before finding out any errors you’ve made.