Finding independent mortgage and home loans advice is not as hard as it sounds. It is very important though if you want to make the right decision about which mortgage is the best one for you.

There are plenty of information about mortgages in the public domain on websites, in magazines and tabulated over and over again in mortgage comparison tables. We believe that because there are so many variables within the minefield that is mortgages, that seeking mortgage advice is essential. In fact, we even recommend you speak to independent mortgage advisors or brokers who have access to the whole UK mortgages market because otherwise you might not get advice covering all mortgages available to you.

This is even more important if you are trying to get onto the first rung of the property ladder and are a first time buyer. With the property market being so tough in the UK, there are more and more first time buyer mortgages on the market now and good mortgage advice for your first home is essential.

Since 2004 the giving of personal financial and mortgage advice in the UK has been governed by the Financial Services Authority. Companies or individuals offering personal financial or mortgage advice must comply with the Financial Services Act or they are breaking the law. Many companies offer consultations on an ‘information only’ basis and you would need to formally agree to having requested to be advised on financial matters. Adherence to the rules of the Financial Services Act is called ‘compliance’.

Mortgage advice can be sought from a number of sources:

• A tied mortgage adviser: These work – and will therefore recommend products – on behalf of just one lender.

• A multi-tied adviser: These will recommend products from a limited range of lenders.

• An Independent Financial Adviser (IFA) or Independent Mortgage Advisor: These will recommend products from the whole market.

You are perfectly entitled to ask on what basis your advisor is operating.

Be warned though, that if you go to see an Independent Mortgage Advisor, they will be independent on mortgages but perhaps not insurance – and most homebuyers take buildings insurance alongside their mortgage.

By researching and reading it is relatively easy to glean a certain amount of useful information but by seeking personal mortgage advice from a mortgage advisor, you will be gaining the expertise of someone who knows all about all the different first time buyer mortgages on the market, what special deals are on offer, the peculiarities of the one lender versus another, what the latest mortgage releases are and of course they will always take your personal plans and circumstances into consideration.

As well as verifying who you are, you will be required to provide evidence of major income (your salary) and your major out-goings like car-loans, student loans etc. If you have loans or debts, it does not mean that you cannot apply for a mortgage.

Mortgage advice can be given in a number of different ways. It can be given by phone, email or in person – different advisors work in different ways. These days professionals are pretty flexible. In order to give you proper mortgage advice, mortgage advisors will need to a great deal of information about your personal finances. They want to determine that you can and will be able to make the mortgage payments. The last thing they want is to repossess your property if you fail to be able to make the mortgage payments. They will ask your permission before they give financial or mortgage advice. You will probably need to sign an agreement form saying that you agree to being given mortgage advices as opposed to just mortgage information.

When the mortgage advisor or mortgage brokers has taken all the information from you about what you want and your finances, you might, after agreeing which mortgage and which mortgage lender is appropriate to you, make a mortgage application.

The selected mortgage lender will scrutinise your form and carry outs some checks of their own

Some advisors gain their income form commission they earn from selling insurance policies and mortgages whilst others charge for giving mortgage advice. You are perfectly entitled to ask about what charges will be applicable in your instance.

Don’t be intimidated by mortgage advisors. Though they have trained for a considerable time to be able to offer mortgage and financial advice, they are human, just like the rest of us.

The internet holds a huge amount of resources for those who are seeking mortgages advice. There is so much more to consider when taking out a mortgage than the rate of interest. A lot of thought has to be given to the additional fees that can be attached to a mortgage and of course the mortgage type.

By using the internet you can amass all the advice needed to choose the right mortgage. You can also find information relating to the different types of mortgages that are available. You can also find out what to look for when it comes to comparing quotes and how to get the best quotes. If you need help when it comes to the technical terms that often describe interest rates and loans then a specialist website will make this available in plain English.

The best way to get mortgages advice in getting the quotes is with a specialist. A specialist will allow you to gather together several quotes on one site. This means it is so much easier when it comes to comparing them as usually the key facts will come attached with the quotes.

You can benefit greatly by taking mortgages advice when it comes to the key facts. This is where you can find any additional costs which could boost up the cost of the loan considerably. People often overlook the importance of checking the small print only to find that the extra costs boost up what they thought was a cheap mortgage. Additional costs such as early redemption fees, valuation fees and set up fees for the mortgage can all be included and they can vary greatly.

You can also benefit from taking mortgages advice when it comes to the type of mortgage. The fixed rate mortgage and the variable rate are the most common and both have their good and bad points. The advantages of the fixed rate are that you can benefit from a very low rate of interest if you can repay the mortgage back fairly quickly. The rate of interest will be fixed over a period of time and will then revert to the current rate of interest. The downside is that if the rate of interest drops during the fixed period then you will lose out. It also means that after the fixed period the monthly repayments can suddenly shoot up.

The variable rate is good again over the short period especially if the interest rate is at an all time low. However the rate of interest can fluctuate over the terms of the mortgage. With the variable you cannot be sure how much the monthly repayments will be over a long period of time and so it is not good for those who like to budget.

Getting as much mortgages advice before signing on the dotted line for the loan is essential when it comes to getting the best deal. A specialist website will offer this advice freely which means that you can start off on the best possible footing.

After an extremely volatile week the financial markets are being capped with incredible events especially coming from government announcements and intervention. With the news coming so quickly here is a recap of the recent events and how they impact mortgage borrowers:

1. Fear about the safety of money on deposit with banks folding or going on brink of collapse. This loss of confidence has caused bonds to lose some or all of their value in certain cases. This news has resulted in money quickly pouring out of stocks and bonds and into U S treasuries.

Impact to borrowers: preventing “lockdown of the markets” with government involvement. Currently people are willing to pay money not to lose principal or basis in their investments…not even worrying about a return on their investment. With the government rushing to back investments and restore trust this means lower rates for borrowers.

2. Government guarantee of market funds. Treasury Secretary Hank Paulson announced the US Government will guarantee money market funds.This action is helping settle the markets and as a result stocks were up last yesterday and rallying again today.

Impact to borrowers: rate volatility from day to day based on current news.

3. Fed makes a decision to support currently unsellable mortgage debt. The mortgage mess has so much uncertainty that investors do not want to buy the investments regardless of the performance level. The government has stepped in as a buyer providing liquidity to investment groups that are holding these securities and keeping them afloat while they to recover.

Impact to borrowers: stabilizing long term impact on fixed rates.

Are these the last changes we will see in the mortgage market?

If the last few years have taught us anything it is that there are more changes to come. At Trusted Mortgage Advice we believe that ultimately the financial markets will determine their own outcome – and that common sense will ultimately prevail.

We see a return to mortgage basics – borrowers will need good credit, a bit of money saved and will need to invest in their own homes.

But at the end of the day government intervention is going to be a necessity here. Why?

Too much at stake. With the size of the financial institutions that are failing keeping them afloat may be worth the investment of taxpayer dollars.

Media coverage. With so much coverage of this financial turmoil politicians and regulators will be under tremendous pressure to do something about it.

Mortgage lending still makes sense. So much of today’s problems have been caused by a lack of good judgment shown by both lenders and borrowers over the last few years. At the end of the day American homeownership will survive and credit worthy, responsible borrowers will be able to obtain credit.

The possibility of a recession is still out there and regulators will do everything they can to avoid letting that happen on their watch.

Looking for Advice on Your Mortgage Situation?

With all of the turmoil we recommend making a thorough financial check up including:

Talk to your banker: check the rates on checking and savings accounts to ensure you get the best pricing.

Talk to your financial advisor: Make sure your investment strategy doesn’t need to change based on current events.

Talk to your insurance agent: It never hurts to ask if you can save money on home, auto or health insurance.

Talk to Trusted Mortgage Advice: Don’t let a mortgage company convince you to take a deal that doesn’t feel right. We will help you evaluate your loan and make sure you are getting the best deal possible.

]]> http://www.aviploan.com/practical-home-loa-advice-for-borrowers-following-recent-events/feed/ 0 http://www.aviploan.com/what-is-a-fixed-rate-mortgage/ http://www.aviploan.com/what-is-a-fixed-rate-mortgage/#comments Wed, 15 Apr 2009 18:37:40 +0000 http://aviploan.com/?p=102

You are ready to buy your first home, fantastic. I thought I would offer some advice to you, things you may or may not have thought of yet. Many people want to buy a home and feel ready but don’t fully realise everything that is involved. It’s great to have your own home and invest in your future however a home is a massive responsibility to take on.

Replacing throwing away ‘dead’ rent money with an investment is great but your home can be possessed if you can’t keep the mortgage repayments up, planning is key to ensure you know what you are getting into and you make the right investment.

Demand certainly outpaces supply in the mortgage market. Mortgage lenders are willing to lend however only to those who are low risk. Your credit score is important; it’s worth checking this before you start applying for a mortgage as they can be anomalies that could make the difference between approval and decline of a mortgage.

The most important mortgage advice first time buyers is to save! As lenders are now much more cautious with their lending and wish to reduce their risk, the larger deposit you have the more likely you are of being approved and at a lower rate of interest.

There are government schemes that help first time buyers get their first property. In Scotland there is the LIFT scheme where the government will take a equity stake in your property in return for putting up money. This scheme is aimed more for those on lower incomes but it is certainly worth looking into, there may be a different scheme in your area.

Use all the resources available to you, the internet is good for mortgage information, giving you explanations of term, calculators to help you work out what you can borrow and what you can afford. Mortgage brokers can offer very valuable mortgage advice to first time buyers, which many do without broker fees. You benefit from their market knowledge, assistance with applications, support through the process and help you avoid common mistakes.

Final piece of mortgage advice, don’t just go to your bank for a mortgage, search around for the best value mortgage with the best terms for you.

Mortgage Madness (2/3): BBC2 – 29/10/2003

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