An article published by This is Money in June 2024 makes for interesting reading. It explains that the average property asking price across the UK remained flat in May and June, sitting at around £375,100.
This could be good news for home buyers, but if you’re considering buying a new property, you might want to consider another article on the financial website. It reveals that many buyers are waiting for an interest rate cut before they look to move home, which could have implications for property prices.
If interest rates drop and many more buyers enter the property market, this could push up prices due to increased demand. As such, buying property while interest rates are higher might be a shrewder option, as you could end up paying less for your new home than you might when interest rates drop.
That said, purchasing a new home when interest rates are higher may not sound like a great idea, as doing so means your repayments could be higher. Working with a mortgage broker could help you find a mortgage deal that reduces your monthly repayments, allowing you to find your ideal home before property prices potentially rise again.
Read on to discover how a mortgage broker could help you reduce your repayments, and two other important ways they could help.
1. A broker saves you time and provides peace of mind
As mortgage brokers have the ability to pass a lot of business to lenders, providers are keen to attract their business. As such, they offer deals to brokers that are not widely available to the public.
This means that a broker might be able to access a deal that provides a more attractive interest rate than you could find by yourself, which in turn could reduce your monthly repayments. Alternatively, they could offer you a fixed-rate product that lasts longer.
Having a fixed rate that lasts longer might allow you to budget further into the future. This could provide you with the assurance that you can comfortably repay your mortgage regardless of what happens with interest rates.
It’s worth remembering that mortgage lenders and comparison websites won’t tell you that mortgage brokers could have access to deals that are not widely available.
2. They can find the most suitable mortgage for you
Working with a broker provides peace of mind that the mortgage they recommend is the most suitable for you. They will consider your circumstances and use their extensive knowledge of the mortgage market to find a loan that is right for you.
While you might think that the mortgage with the least expensive interest rates would be the best, in reality this might not be true. Choosing the cheapest mortgage could result in you paying significantly more over the long-term if, for example, you opt for a 40-year term instead of a 25-year loan at a slightly higher rate.
Other factors a broker will consider include:
- whether there is an up-front product fee
- the mortgage’s loan-to-value (LTV), which will determine how big your deposit needs to be
- setting-up costs and exit penalties the provider may want to charge
- how much the provider will allow you to overpay your mortgage each year, as many lenders restrict this.
It’s also worth remembering that if a broker is independent, as AFH’s are, they will be able to access the whole of the mortgage market, effectively meaning their product range is unlimited. As such, they could offer a wider selection of deals for you to choose from.
3. A broker saves you time and provides peace of mind
Looking for a mortgage by yourself can be time-consuming. With so many different providers offering so many different deals, it can take a long time to whittle down your options to the ones that are best suited to you.
A mortgage broker can do this on your behalf, meaning you can get on with your life in the knowledge that you’ll be offered the most suitable option for your needs.
Furthermore, when you do apply for a mortgage, it can be stressful. The applications can be long, and one simple mistake could significantly delay the process of being accepted for the loan, which could cause stress – especially if you’ve had an offer accepted on your dream home.
As brokers are well practiced at completing applications, they can guide you through the process to ensure that you fill it in correctly and avoid any common mistakes. In addition to this, they also understand which lenders are likely to look at your application more sympathetically if, for example, you’re a first-time buyer, self-employed or both.
Thanks to their experience, brokers also understand what different lenders will and won’t accept. For example, some providers won’t lend on properties above certain types of businesses.
This means you won’t waste time making an application to a lender that’s highly unlikely to accept your application.
Get in touch
If you are looking to buy a new home and would like to talk to one of our independent mortgage brokers, please get in touch by calling 01527 577775. We’ll provide clear and understandable advice that could help you reduce your monthly repayments and ensure that the mortgage you decide on is right for you.
Thursday 11 July 2024