FAQs

A very good question! This depends on all sorts of factors to your current financial situation. Lenders will take into consideration your income, commitments, debts and your credit profile. Each lender also uses different income calculations and algorithms to work out your maximum borrowing. We’ll help guide you through the process and make each step as seamless as possible. Get in touch with us here to book an initial appointment.

• Mortgage Product fee- Usually around £999. This can either be paid upfront or added to the mortgage balance, subject to affordability.

• Valuation fee- The lender may charge a fee for their Valuation (typically between £100-£500). This is for them to come and assess whether the property is good security for them to lend on it.

• Surveys- The price depends on the type of survey. Generally ranges from a few hundred pounds to £1000+ for a full structural survey. It’s also determined by the size of the property. There are lots of different types of surveys and specialist reports available. We can put you in contact with local surveying firms to assist.

• Solicitor Fees- Average £1000-£1500 for a purchase.

• Broker Fee- For our services, we will charge a fee between £199 and £999. This will depend on the complexity of your situation and the value of the mortgage. Your advisor will be able to discuss this with you further.

• Stamp duty land tax– A government tax which varies depending on the value of the property and the position of the buyer. For example, as of September 2022, First Time Buyers buying a home up to £425,000 in England and Northern Ireland do not have to pay any stamp duty. In comparison, those wanting to purchase a second residential property usually have to pay an additional 3% surcharge on SDLT.

• Other moving costs- Consider whether you’re hiring a removal van, any new furniture/items for the property.

Lender's Standard Variable Rate (SVR):

• SVR is the default interest rate set by a specific mortgage lender.

• The interest rate on an SVR mortgage can vary at the discretion of the lender and is not directly tied to any external benchmark, such as the Bank of England Base Rate.

• Lenders can change their SVR independently, and these changes may not necessarily follow changes in the broader economy or interest rate market.

• Borrowers on an SVR mortgage are typically not protected from interest rate fluctuations and may see their mortgage payments rise or fall depending on the lender's decisions.

Bank of England Base Rate Tracker:

• A tracker mortgage is directly linked to the Bank of England Base Rate (BoE Base Rate).

• The interest rate on a tracker mortgage is variable and will move in sync with changes in the BoE Base Rate. When the BoE Base Rate goes up or down, the interest rate on your mortgage will follow suit.

• Tracker mortgages often have a set "margin" or "spread" above the BoE Base Rate, meaning that the interest rate you pay will be the Base Rate plus a fixed percentage.

• Tracker mortgages provide borrowers with more transparency and predictability regarding how changes in the BoE Base Rate will affect their mortgage payments.

It's important for borrowers to carefully consider their financial circumstances, risk tolerance, and interest rate outlook when choosing between these mortgage products, as the type of mortgage they select can significantly impact their monthly payments and overall borrowing costs. Additionally, mortgage terms and conditions can vary between lenders, so it's advisable to review the specific terms of any mortgage product you are considering.

Below are just some examples;

• Buildings Insurance: In the UK, it is a requirement from the lender for homeowners with a mortgage to have buildings insurance. This insurance covers the structure of the property, including the walls, roof, floors, and other fixed features. It provides protection against damage caused by events like fire, flood, storm, subsidence, and vandalism. The purpose of this insurance is to ensure that the property can be repaired or rebuilt in the event of damage or destruction.

Lenders will usually require proof of buildings insurance before they release funds for the mortgage, and they may offer their own insurance options if you don't have coverage in place. However, you have the flexibility to choose your own insurer, but it must meet the lender's requirements.

• Life Insurance: Life insurance is optional but highly recommended for homeowners with mortgages, especially if you have dependents. It provides a financial safety net for your family in case you pass away, helping them pay off the mortgage and cover living expenses.

• Income Protection: Income protection insurance in the UK provides individuals with a monthly income if they are unable to work due to illness or injury. It offers financial security, replaces a portion of lost income, and can cover a wide range of conditions. It's flexible, tax-free, and helps individuals maintain their standard of living during times of disability.

• Critical Illness Cover: An insurance policy that provides a lump sum payment if the policyholder is diagnosed with a specified critical illness or medical condition. It offers financial protection to cover medical expenses, debts, or other financial needs during a serious health crisis. The covered conditions vary by policy, and the lump sum payment is typically tax-free, helping individuals and their families cope with the financial impact of a critical illness.

There are lots of options available and we know it can be overwhelming. Arrange a chat with our Protection Specialist, James Phillips, to discuss which would best suit your needs.

A repayment mortgage means that with each monthly payment you make, part of it is going towards the capital repayment and part towards the interest owed to the lender. With a repayment mortgage, as long as you meet your monthly repayments, your balance will reduce and the mortgage will be paid off at the end of the term. This is a common arrangement for a residential mortgage.

In comparison, an Interest Only mortgage involves no capital repayment and the monthly payments just consist of the interest owed to the lender. In this case, the balance will not reduce as you make each monthly payment. This type of mortgage is popular for Buy to Let properties, as the monthly repayments are lower and allow landlords to benefit from the rental income.

Whether it’s a missed payment on a utility bill, a default on a credit card or a registered CCJ, we’re here to help.

The first step will be to get in touch with us and we can walk you through your options. You will want to download a copy of your credit report which will give a full overview of your credit history and current commitments. From there, one of our advisors can assess the situation and map out some routes to move forward.

Loan to Value, commonly LTV for short, is the amount of equity in the property against the loan amount. For example, if you’re putting down a 10% deposit, the Loan to Value will be 90%.

Using a Mortgage Broker offers several benefits:

• Access to Multiple Lenders: Mortgage brokers have access to a wide network of lenders, including those that may not be available to the general public. This increases your chances of finding a suitable mortgage with competitive terms.

• Expert Guidance: Brokers are mortgage experts who can provide personalized advice based on your financial situation and goals. They can help you navigate the complex mortgage market and choose the right product for your needs.

• Time and Effort Savings: Brokers handle the research, paperwork, and negotiations on your behalf, saving you time and effort. They streamline the application process, making it more efficient.

• Cost Savings: Brokers can often secure better mortgage rates and terms due to their relationships with lenders. This can potentially save you money over the life of your mortgage.

• Tailored Solutions: Brokers consider your unique circumstances and financial goals to recommend mortgage products that align with your needs, whether you're a first-time buyer, a homeowner looking to remortgage, or a property investor.

• Impartial Advice: A reputable mortgage broker is unbiased and works in your best interest, not for any specific lender. They help you make informed decisions without being influenced by commissions.

• Comprehensive Market Knowledge: Brokers stay updated on the latest mortgage market trends and products, ensuring you have access to the most current information.

• Prequalification Assistance: Brokers can help you get prequalified for a mortgage, for example with a Decision in Principle, which can strengthen your position when making an offer on a property.

• Simplified Comparison: Brokers can provide you with a clear comparison of mortgage options, making it easier to understand and choose the most suitable one for you.

In summary, using a mortgage broker in the UK can save you time, money, and stress while helping you find the right mortgage to meet your specific needs and financial goals.

We are an Appointed Representative of PRIMIS Mortgage Network, a trading name of Personal Touch Financial Solutions Limited. Personal Touch Financial Solutions Limited are regulated by the Financial Conduct Authority (FCA). The FCA is the regulatory body responsible for overseeing and regulating financial services, including mortgage intermediaries and brokers. We must adhere to the FCA's rules and guidelines to ensure consumer protection and fair and ethical practices in the mortgage market.

By regulating the industry, the FCA aims to protect consumers and maintain the integrity and stability of the mortgage market in the UK. Consumers can check whether a mortgage broker is authorized and regulated by the FCA by visiting the FCA's Financial Services Register, which provides information on authorized firms and individuals.

No problem, get in touch at enquiries@prowsefinancial.co.uk and we’ll be happy to help.