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So ... you’d like to know a bit more about mortgages and buying a property
First up - the property purchase and mortgage process. This is a rough guide to how it goes from start to finish. We'll be here to help every step of the way. 1. First meeting with scales porter to discuss options - BOOK THIS NOW! 2. We apply to the best lender for a Decision in Principle 3. Find your property [we'll give you a checklist to help you inspect properties properly] 4. Make an offer on a property you want to buy ... once you have an offer accepted ... 5. Appoint a solicitor – they will carry out searches, manage funds, pay stamp duty, etc. [we recommend you use our solicitor as they are tried and tested and come highly recommended by previous buyers] 6. We fill out full application to the chosen lender, and submit all other compliant documents. They proceed with administrating the mortgage. [Formal mortgage offer now between 2-6 weeks depending on lender]. At this point the lender takes the valuation fee and sometimes an administration fee – we will need your payment card details for this 7. We apply for your insurance policies with the chosen providers 8. The valuation will be instructed by the lender and carried out by their surveyor 9. We regularly chase the lender and generally project-manage the mortgage and purchase 10. The lender makes a mortgage offer and sends a copy to the adviser, the client and the solicitor 11. Once the solicitor is happy with the property and has seen the mortgage offer they will: - Pay the deposit [this needs to be in their account ready – usually 10% of the purchase price] - Exchange contracts. [You are now legally bound to buy and the seller to sell] - Set completion date 12. At this point we put buildings, contents, Income protection, life and critical illness policies on risk so that you and your home are covered for any mishaps/misfortunes. 13. Completion [that’s when you get the keys!]; your solicitor deals with the exchanges of funds between the seller, the lender and you. They pay the stamp duty and you start paying for the mortgage, protection and insurance monthly. 
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Second up - an explanation of the different mortgage options and their features.
Fixed and variable interest rates Tracker - A variable rate loan with an interest rate that's equal to or a set amount above or below the Bank of England or some other base rate. It tracks (moves up or down with) that rate. Fixed - Your payments are set at a certain level for an agreed period. Capital repayment, interest only or a mix of both? Repayment mortgages - Every month, your payments to the lender go towards reducing the amount you owe as well as paying the interest they charge. So each month you're paying off a small part of your mortgage. Interest only mortgages - Your monthly payment only pays the interest charges on your loan – you're not actually reducing the loan itself. Your monthly payments will therefore be lower than an equivalent repayment mortgage. The total cost of an interest-only mortgage may be more expensive though, as you must also pay back the loan at the end of the term and this will depend partly on how you intend to pay it back. Although you can choose how you pay back the loan, you should make sure you know from the beginning how you will be able to pay it back. How long should my mortgage term be? The overall term of the mortgage is different to the initial deal period. The term lasts right until the proposed end of the mortgage – when you plan to have it paid off. If you opt for a repayment mortgage, the longer the term you choose, the lower the monthly payment will be. What are early repayment charges [ERCs]? If you repay all or part of your mortgage earlier than the agreed period – usually the same as the initial deal period. What is an Offset mortgage? With an offset mortgage, your main current account or savings account (or both) are linked to your mortgage and are usually held with the mortgage lender. Each month, the amount you owe on your mortgage is reduced by the amount in these accounts before working out the interest due on the loan. So as your current account and savings balances go up, you pay less on your mortgage. As they go down, you pay more. This mortgage feature could be right for you if you have lots of savings. Would you like to know how we are paid? |
Thirdly and finally - you need a good solicitor and a good surveyor
Solicitors
A good property solicitor will be a skilled professional who will explain the process to you clearly, be available, apply extreme attention to detail and not charge you the earth. We have found a selection of solicitors that we trust, having worked with them over a number of years.
Surveyors
The lender will carry out a valuation on the property you are buying once we have submitted a full mortgage application. The valuation is for their purposes and is by no means a full building survey. We always recommend that you instruct your own independent survey.
When you are looking to buy a new property, as either an owner occupier or an investor, you need prompt professional advice to highlight any areas of concern that you need to know about to make an informed decision with the purchase.
A good building survey is a comprehensive report following a detailed survey of the property, regardless of its age or apparent condition. Remember that a lot of properties are ‘dressed up’ for sale, so on first inspection can appear to be in good overall condition.
We recommend surveyors we trust who offer proactive professional advice to property buyers. They will investigate any issues with the building, will report on how the defect has occurred and what needs to be done to put it right, and where appropriate what the potential consequences of non-action are.
Solicitors
A good property solicitor will be a skilled professional who will explain the process to you clearly, be available, apply extreme attention to detail and not charge you the earth. We have found a selection of solicitors that we trust, having worked with them over a number of years.
Surveyors
The lender will carry out a valuation on the property you are buying once we have submitted a full mortgage application. The valuation is for their purposes and is by no means a full building survey. We always recommend that you instruct your own independent survey.
When you are looking to buy a new property, as either an owner occupier or an investor, you need prompt professional advice to highlight any areas of concern that you need to know about to make an informed decision with the purchase.
A good building survey is a comprehensive report following a detailed survey of the property, regardless of its age or apparent condition. Remember that a lot of properties are ‘dressed up’ for sale, so on first inspection can appear to be in good overall condition.
We recommend surveyors we trust who offer proactive professional advice to property buyers. They will investigate any issues with the building, will report on how the defect has occurred and what needs to be done to put it right, and where appropriate what the potential consequences of non-action are.
Your property may be repossessed if you do not keep up repayments on your mortgage.