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Written by:
Alison Gibson
Ascot Mortgage Expert
Last Updated:
20.11.2023
Written by:
Alison Gibson
Ascot Mortgage Expert
Last Updated:
20.11.2023
Mortgages
Securing a mortgage, a loan taken out to buy property or house, can feel like navigating a complex maze. With the mortgage market in the UK being so complex and fast changing, it is essential to make an informed decision when picking the right mortgage for you. This article aims to highlight the mortgage pathway, providing you with comprehensive insights and guidance.
How to Get a Mortgage
- Check your credit score: Your credit score impacts the mortgage rates offered to you. You can check your score for free with a credit reference agency.
- Decide what type of mortgage you need: Your choice will hinge on your personal circumstances, the property or house in question, and the amount you can afford to repay monthly.
- Save for a deposit: As a rule of thumb, a larger deposit equates to lower interest rates.
- Compare mortgages: Utilise a mortgage comparison tool to help you unearth the best mortgage deal tailored to your specific needs, including the percentage of interest and deposit.
- Apply for a mortgage: You can either apply directly to a lender or engage a mortgage advisor or broker to help you navigate the market. At Ascot Mortgages, our professional advisors provide impartial mortgage advice, guiding you to the best deals across the market, including those specific to house purchasing.
- Obtain a decision in principle: This statement from a lender promises a certain loan amount before you’ve finalised the purchase of your house subject to full underwriting.
- Complete the purchase: After your offer on a property or house is accepted, you can finalise the mortgage application process.
Mortgage Repayment Calculator
What Mortgage Do I Need?
Identifying the right mortgage deal for your needs is vital. Let’s explore a few types:
Remortgage
Remortgaging allows you to switch your current mortgage to a new deal with your existing lender or a different one. If your fixed-rate term is nearing its end or if interest rates have dipped since your mortgage initiation, remortgaging could save you money. Our Ascot Mortgages team is well-versed in facilitating remortgages, aiding in securing the best deals for residential properties.
First Time Buyer
First-time buyer mortgages are tailored for individuals taking their first steps into property purchase. Factors such as income, credit score, and deposit size are considered by the lender.
Buy-to-let Mortgage
Buy-to-let mortgages cater to those purchasing a property for investment purposes. Typically, these are interest-only loans, where only the interest, not the loan itself, is repaid each month. Ascot Mortgages is a leading mortgage broker in securing buy-to-let mortgages, helping investors to achieve their goals of either increased income or capital growth for their future pension.
Ascot Mortgage Expert
What Our Expert Says...
Mortgages help many people buy their dream homes. However, choosing the right mortgage can be tricky due to the many options available. Whether you’re buying for the first time or considering a new mortgage, good advice is key. Always remember, mortgages are long-term deals, so make sure you choose wisely. I am here to help guide you to the right decision. Don’t hesitate to seek expert advice when you need it.
What Are the Different Types of Mortgages?
The world of mortgages offer many different options. Here are some commonly chosen types:
Fixed Rate
A fixed-rate mortgage provides the security of a fixed rate of interest for a predetermined period, ensuring consistent monthly repayments.
Variable Rate
A variable rate mortgage, conversely, has a fluctuating interest rate, meaning monthly payments could rise or fall.
Tracker Rate
A tracker rate is a variable interest rate which ‘tracks’, or follows, the Bank of England base rate, or Sonia rate for example meaning monthly payments could rise or fall.
Discount
Discount mortgages offer a reduction on the lender’s standard variable rate (SVR) for a certain duration.
Standard Variable Rate (SVR)
The SVR is a type of mortgage interest rate that you are most likely to switch to after an initial fixed, tracker or discounted deal expires.
Fixed or Variable Offset Mortgage
An offset mortgage ties your mortgage to your savings account. The savings are ‘offset’ against the mortgage debt, and you only pay interest on the balance between the two.
Interest Only
An interest-only mortgage involves paying just the interest on the loan and nothing off the capital – the amount you borrowed.
What Mortgage Can I Afford?
Your income, outgoings, credit score and deposit size all influence the mortgage loan you can afford. Lenders use these factors to assess lending risk.
A mortgage calculator can be invaluable in determining how much you could potentially borrow and what your monthly repayments would be.
Mortgage calculators provide a snapshot of how much you might be able to borrow, and what your repayments could look like. They consider the loan amount, the interest rate, and the loan term.
Help for First-Time Buyers
Several schemes aim to support first-time buyers stepping onto the property ladder:
The Mortgage Guarantee Scheme
This scheme sees the government providing lenders the guarantee required to offer mortgages covering up to 95% of the purchase price.
Help to Buy Equity Loan
Under the Help to Buy Equity Loan, the government lends you up to 20% of the cost of your newly built home. This is combined with a 5% deposit and a 75% mortgage to cover the remaining cost.
Help to Buy Shared Ownership
Shared Ownership enables you to buy a share of your home (typically between 25% and 75%) and pay rent on the remaining share.
Stamp Duty Relief
In the UK, first-time buyers can benefit from stamp duty relief, meaning no stamp duty is paid on properties up to a certain value.
Choosing a mortgage is a significant financial decision, and getting the best advice is critical. Always consider your personal circumstances, do your research, and seek professional advice if required. As a family-run business with over 40 years’ experience in the financial services industry, Ascot Mortgages is dedicated to delivering the best mortgage deals while maintaining excellent customer service.
Taking that leap to secure a mortgage can indeed seem like a daunting process, especially for first-time buyers. The vast number of choices and considerations can easily leave one feeling somewhat lost. That’s why consulting with a seasoned professional can dramatically increase your chances of success. It can bring clarity to those seemingly convoluted mortgage-related complexities, preventing you from falling prey to any potential pitfalls borne out of a lack of understanding.
Now’s the time to align yourself with a trusted partner to secure the most advantageous mortgage deal for a house. With Ascot Mortgages, you’re not just comparing mortgages; you’re elevating the entire process. So stay connected and discover the real opportunities that await you within the UK’s mortgage landscape. Don’t just secure a mortgage; master it with Ascot Mortgages and make your dream house a reality.
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FAQ
A mortgage is a loan used to buy property or land. You repay the loan, along with interest, over a set term. The property is used as security until the loan is fully repaid.
The LTV ratio is the amount of the loan compared to the value of the property. For example, an 80% LTV means you borrow 80% of the property’s value. The rest is covered by your deposit.
This depends on your income, outgoings, and personal circumstances. A general rule is that your mortgage payments should not exceed 28-35% of your gross income. When you’re ready, we can help you work out what you can afford.
This is the cost of borrowing money for your mortgage, expressed as a percentage of the loan. It impacts your monthly repayments and the total amount you’ll repay.
Consider the type of mortgage, its term, repayment structure, fees, and the lender’s customer service.
A mortgage in principle is a conditional offer made by a mortgage lender that they would ‘in principle’ give you this amount of money towards purchasing a property.
APRC stands for Annual Percentage Rate of Charge. It includes both the mortgage interest rate and any associated costs for securing the mortgage.
Common fees include booking fees, arrangement fees, valuation fees, and legal fees.
You’ll usually need buildings insurance, and you may want to consider life insurance, income protection, and critical illness cover.
Improving your credit score, saving a larger deposit, reducing debts, and ensuring you’re on the electoral roll can all help.
Typically, you’ll need at least 5-10% of the property’s value, although a larger deposit could secure better rates.
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Legal
Ascot Mortgages authorised and regulated by the Financial Conduct Authority and can be found on the FCA register (www.fca.org.uk) under reference 776062. The FCA do not regulate some forms of mortgages. The guidance and advice contained in this website is subject to UK regulatory regime and is therefore restricted to consumers based in the UK. There may be a fee for mortgage advice. The precise amount will depend upon your circumstances but we estimate it will be £399 per mortgage account. Ascot Mortgages Ltd give you the option to pay a non-refundable fee of £879 payable with the application. If this option is taken, Ascot Mortgages Ltd will refund any procuration fee received by the lender.
Ascot Mortgages Limited is registered in England and Wales and have their registered office at 8 Webster Court, Westbrook, Warrington, WA5 8WD. The company’s registration number is 06764971.
We are a credit broker, not a lender. We work with the whole of the lending market. We may receive commissions that will vary depending on the lender, product, or other permissible factors. The nature any commissions model will be confirmed to you before you proceed.
YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE
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