Broker/IFA helpful for maximum mortgage?

the_grid

Title says it all- we are about to buy a house and will need the maximum loan we can get. I've heard it can help to go through a broker (why?)... is this true and are all brokers equal or some more favoured than others?

I,_Brian

Brokers can be helpful in terms of potentially having access to a wide range of mortgage products, but it's worth bearing in mind that a number of lenders have been cutting them out of the loop.

For example, Nationwide currently have a 5.74% mortgage with £599 fee:
http://www.nationwide.co.uk/mortgage/default.htm

But it's exclusive for direct customers - last broker I spoke to said they could only offer something like a 5.99% mortgage from Nationwide and with £1500 arrangement fees.

It's worth shopping around to have a context to compare your broker's advice.

Your big limit in my opinion is your remortgage amount - the lower it is under 80%,
the easier it should be for you to find a good deal.

arkie

the deal nationwide offer only goes to 90% loan to value, as you are buying not remortgaging you will be looking at 95% loan to value rates as a maximum advance, so you will need a 5%. Contact a WOM broker and use them

Wutang_2

the_grid wrote: »

Title says it all- we are about to buy a house and will need the maximum loan we can get. I've heard it can help to go through a broker (why?)... is this true and are all brokers equal or some more favoured than others?

Title says it all indeed - you need the maximum loan you can get!!! You need to speak to a broker with little conscience who will let you borrow 15 X income on a horrible rate with fees and MIG.

Plan A would be find out what a broker does, work out how much this 'maximum loan' will destroy you on a month to month basis and then come back on here with some figures...

...And are some brokers more favoured than others?....this is verging on the theories of Darwinism on which I have little knowledge.

_Andy_

the_grid wrote: »

Title says it all- we are about to buy a house and will need the maximum loan we can get. I've heard it can help to go through a broker (why?)... is this true and are all brokers equal or some more favoured than others?

Hi

When you say you're 'about to buy a house' - do you mean you've already got one in mind and want to make an offer/have made an offer? If so then if you can state the house purchase price and your incomes we can let you know if it's viable.

If not, and you just want an idea of maximums, then really the maximum you'd be looking at would be 5xjoint income assuming spotless credit record and a good deposit.

herbiesjp

I think some have jumped the gun here a little bit


OP - can you please post what purchase price you are looking at?
What deposit you have?
What your gross yearly salaries are?
Do you have any other debts in the background?
Do you both have a clean credit history?

Brokers can help find exclusive deals (sometimes you can get them going direct) - they cannot influence what multiples a lender offers you - although if you are borderline on income multiples, they can put a case forward as to why a mortgage would be suitable and see what the underwriters come back and say

the_grid

Thanks for the replies so far. As for the details:

House purchase price will be £1,100,000
Deposit: £497,000
Joint income: £110,000

Mortgage required: £650,000 (59% LTV)

There are a few variables- I am self-employed but average for last 3 years accounts is £55,000 pa. We have another (mortgage free) property which will be rented at £750 per month (so say £7500 per year, assuming a conservative 2 months a year void).

Even so, we are at the outer limit of the amounts most mortgage companies are prepared to lend- hence my question; would going through a broker help present a more persuasive case?

The other option I have been thinking about (for any mortgage junkies out there) is to take a loan on the rental property (very tax efficient, but will be at a higher rate as will have to be a buy-to-let rate) and thus lower the other mortgage amount.

herbiesjp

What goes in your favour here, is the LTV

Although you are looking at the very high end of income multiples - there may be some lenders that would be a bit more flexible in their underwriting/affordability caculators with a good case put forward to them

Alternatively, you could raise funds on your BTL property, thereby increasing your deposit and reducing the income multiples needed

Either way, I would suggest going via a broker in order to make sure all options are looked at for you and put your case forward in the best possible light to a lender

dwsjarcmcd

I would agree with Herbiesj, this is a case for a broker. One further factor that goes against you is that many lenders are reducing the amount they are prepared to lend, some to around the £500k mark. Add to that that the rates/fees can increase with larger loans, making affordability an issue (which with the figures your talking about, would be anyway!)

David

Ian_Griffiths_Halifax

Broker/IFA helpful for maximum mortgage?

I could do my own Self Assessment Tax Returns, but I still use an Accountant to make me the biggest saving on my Taxes.

I could fix my own car, but I use a Garage to make sure it's done right.

I could build my own extension, but I use a Builder to make sure it's not going to fall down.

silvercar

Make sure you are getting the best price on the house. There will be few buyers who are not on the end of large chains buying in your price range. You may have the opportunity for serious price negotiation.