There are good reasons why in life it’s always worth securing a second opinion.
So it always surprises me when I speak to people about their mortgages and hear that they approached their bank and no-one else.
Martyn Lewis on TV last week reiterated the need to review your mortgage on a regular basis. Whilst people know this is the sensible thing to do, the truth is it often stays on the to do list or people opt for what they consider the ‘easy’ route – staying with their current lender or approaching their bank.
I recently helped a client who had an old interest only mortgage with a large lender. Their mortgage was on a very high, standard variable rate (SVR) with no early repayment charges and had been for several years. I moved the mortgage to a full capital repayment with a new lender and still managed to save them over £100 on their monthly payments. Another point to note: the lender was so keen to take the mortgage there were no set up costs, no valuation fees and no solicitors fees.
Knowing that it’s financially savvy to review your mortgage is one thing; how you should approach it is another.
It’s relatively easy to boot up the lap top and look on one of the comparison sites to see the rates available, but how do you know if that lender will agree to your application? Each lender has different criteria and those differences are not reflected in the rates tables.
This brings me to my point: why not take advantage of the knowledge and skills of the professionals - independent mortgage brokers?
An independent broker can source mortgages from the whole of the market. Rather than sitting in front of one potential lender, we can effectively get them all round a table and ask who wants your business.
Secondly, we speak the same language as the lenders. As someone who has been employed on that side of the mortgage world, speaking the language and knowing how the industry works is a definite help towards a successful application. Having a specialist broker liaising on your behalf can save time, effort and help avoid potential pitfalls.
Thirdly we can generally access the most competitive rates. Brokers can often access better rates with the banks than the branch staff can. This is due to the volume of business collectively brokers can place.
Other reasons to use a professional:
- Less hassle – having a dedicated person managing your application and speaking to lenders on your behalf means you don’t have to spend your lunchtime on the phone talking to a call centre, or chasing solicitors.
- A reputable broker will match you to the right product increasing your changes of acceptance.
- Without the right tools, finding the best rate can be a challenge - with more than 200 options at each loan to value (LTVs). Independent brokers have the tools and the market knowledge of those rates.
- More complex situations, for instance bonus income, are best dealt with by specialist brokers. Many high-street lenders use a smaller percentage of bonus income in their affordability calculations. A broker will know which lenders use a more generous allowance.
If you’re ready to use a mortgage professional, dig out your mortgage details and give us a call. We’ll see if we can save you some money. This is the information you’ll need to hand:
- Amount outstanding
- Current rate
- Current term of mortgage
- Any early repayment charges
- Estimated value of your property