Customers often come to OVISO with many questions about their financial situation and the process of acquiring a mortgage. To help, our financial experts have picked out some of the most common mortgage queries and answered them as simply as possible.
1. I’ve found a property I love, now what?
Negotiate your offer with the estate agent. Don’t be shy to put forward a lower offer and be prepared to discuss counter-proposals!
2. Will I need a deposit in order to obtain a mortgage?
Yes. It’s common to provide 10% (of the property’s value) however there are mortgages available where the deposit can be as little as 5% of the purchase price. It is also useful to understand that if you were to put down a higher deposit, you are likely to achieve a better rate with a lender. Sometimes saving a little longer for a larger deposit might pay off in the long-run.
3. How much can I borrow?
This all depends on your circumstances as every mortgage company is different. All financial commitments such as credit cards, hire-purchases, loans, nursery and childcare costs can potentially have an impact on the amount you can borrow. Conduct an audit of all of these commitments to get an accurate idea of what you can borrow quickly.
4. What type of advisors are available for me?
There are two types of advisers:
a) Mortgage Brokers
Able to advise and recommend suitable financial products from a ‘comprehensive range’ of mortgage providers right across the market. Here at Oviso we are mortgage brokers.
b) Restricted Advisers
Can only recommend certain products or mortgage providers to you. A restricted adviser should be able to explain the nature of the restriction to you clearly.
5. What is an agreement in principle?
Also known as a 'Decision in Principle' (DIP), this is a certificate or statement from a lender to say that 'in principle' they would lend you a certain amount of money based on the basic information provided and your credit scoring. Please be aware that this does not secure you a mortgage.
6. What fees are involved with taking out a mortgage?
Aside from the obvious, the following will incur a cost
a) Mortgage application, including booking and arrangement.
b) Mortgage Broker advice
c) Valuation and Survey
(A mortgage valuation is a survey that is compulsory with a lender. It is all about determining whether the property is safe to lend on and up to what amount. A homebuyer’s or full structural survey is an optional extra on top of your mortgage valuation. It is a detailed inspection of a property’s condition and will tell you if there are any structural problems.)
d) Stamp duty
e) Solicitor hire
f) Removal service
7. Do I need a solicitor?
Yes. A solicitor ensures that the person selling the house has a legal right to do so. They will deal with the stamp duty, land registry, collecting and transferring of money. They will also provide legal advice and process your transactions for the exchange of contracts as well as completion.