Essential Guide to Buying a House
Independent Financial Advisor Back to Guide
Go and find an independent financial advisor- you shouldn't have to pay for their service. Most estate agents tend to have an IFA affiliated to them, (you don't have to use that estate agent to buy your house!). They have access to a huge database which gives out much more accurate details then banks' online mortgage calculators. The other advantage to using an advisor is that they tend to have relationships with the mortgage providers so that when it comes to filing your application they ensure that it goes through smoothly.
They type all of your details in to a huge data base-
- Monthly salary (when it comes to the mortgage application you need to show three months pays slips)
- Bonus (do you get one, how likely is it that it will pay out?)
- Any other income?
- Deposit - the more you have, the more you are likely to be able to borrow. (If you have a large deposit, many lenders will look beyond the traditional 31/2 x salary model)
They will also deduct any debts that you may have -
- Student loans
- Credit cards
Using all of this data, the database will calculate the maximum amount you can borrow, it will also show you how much the mortgage will end up costing you over the full 25 year term. So although an interest only mortgage may seem very attractive in the first few years, over a full 25 year term it may end up costing you a lot more than a repayment mortgage.
It is also important to look at the individual clauses of each mortgage provider:
- What is the joining fee
- How much do they charge to survey the house?
- Are there penalty clauses for early payment
- If you choose a fixed rate mortgage what happens after the time is up
- Are there any incentives to join the scheme?
- What will the monthly payments - can you afford these?
Check out our online mortgage comparison tool for the best rates and deals available for mortgages
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