Questions to ask the broker

moozie_2

Hello again

Following another thread on here and your helpful replies, I am back for more

We have an appointment with a fee free whole of market broker on Wednesday. Are there any questions we MUST ask? This is the first time we are doing this face to face. We phoned London and Country and they didn't want to agree a mortgage in principle until we had found a property. The broker we are seeing is happy to agree it in principle so hopefully, vendors can view us more seriously. Hope this makes sense.

We have made a neat list of our income and expenditure, as well as my debt commitments and OH's endowment policies etc so we have a clear idea on how much we can afford to pay on mortgage and bills a month. Do we need anything else?

Thanks again for your help.

AndrewSmith

Hi,

Ask the following questions

1) Ask for a copy of his/her Initial Disclosure Document. This will detail any fees, level of advice etc.

2) Ask if there is any limitiation on the lenders available to them. Whole of Market can still mean they have access to only a handful of lenders.

3) Ask about their trading history and experience in the industry, and how long they have been transacting UK mortgages. You can also check their FSA number against the FSA register to see back as far as November 2004.

http://www.fsa.gov.uk/register

Never let the broker take away original documentation from your home such as passports, driving licenses etc. Have copies of the following ready:

latest 3 payslips each
latest p60 each
passports
driving licenses including the counterpart
latest 3 bank statements
latest mortgage statement
all most recent credit card statements
utility bill in both your names dated within the last 3 months

The broker can then compare these copies against your originals in your home, and certify them as true copies. This way if you want to cut ties with the broker you can do so without feeling beholden as he has your original documents. Also one should never let anyone take such original documents away especially as it willbe the first time he has met you.

Lenders these days are more than happy to accept certified copies of all documents, I have never had these refused yet.

Hope this helps and let us know how it goes.

Andy

moozie_2

What a wonderful, comprehensive and friendly reply. Thank you very much indeed.

First time buyers (well me anyway, OH used to own a property previously) and it's so helful to have this place to come to for this type of queries.

Thank you again Andy :T

AndrewSmith

My pleasure

moozie_2

Well, we met the broker who was very nice. He had a really friendly manner about him and he explained thoroughly what he can and can't advise us on. He's whole of market and has access to all lenders except one, HSBC. He charges no fees, never had any serious complaints and he has provided us with the company's FSA number.

Everything went pretty much as we expected. He advised us based on our income we can borrow as much as £287,000. Obviously we don't want to borrow that much, in fact we are looking at borrowing £180,000 as a max plus our deposit. We've had to increase the amount from our original estimate as we can't find a suitable property

I was wondering if anyone here has any advice for us on the term. I mentioned in another post my OH will be retiring in 14 years time and we aim to have the mortgage paid off by this time, through overpayments (redirection of my £600 in debt repayments ) and lump sums.

The broker suggested we took a fixed rate mortgage for 25 years with 2 years tie in. This will make the payments low enough to start with and as I pay off my debts and the lump sums become available, we can look at re-mortgaging at the end of the 2 years to a shorter term. We are keen to keep the repayments low to start with but not sure of the term. Should we go for the 25 years and then reduce it or should we just go with 14 years from the beginning? Can anyone offer me some re-assurance please as re-mortgages is another new area on top of mortgages

We have an appointment with another broker this Saturday which we will keep even though we felt the one we met yesterday was very professional and friendly. I think it will give us some confidence that we are getting the best advice possible - outside of this forum anyway

Thank you

AndrewSmith

It really depends on your husband's age. What you don,t want to do is restrict the number of mortgage companies available to you by asking for a mortgage that is 11 years past retirement.

It also depends on the affordability of the 14 year term on a repayment basis.

If the 14 year term is affordable (I am guessing it may be based on the fact that you are well withing your maximum borrowing capability by 107,000) then I would simply set the term to co-incide with retirement.

You can still make overpayments by lumpsum or minthly if you wish. It just then gives you the guarantee that you will enter into your husbands retirement mortgage free.

Andy

moozie_2

AndrewSmith wrote:

You can still make overpayments by lumpsum or minthly if you wish. It just then gives you the guarantee that you will enter into your husbands retirement mortgage free.

Andy

Thank you Andy, that's helpful. I think this is the main thing that's on my mind today, having processed all the information we received yesterday. We want to be certain the mortgage will be paid off before my partners retirement and without using his pension lump sum.

Something to talk about with my OH a bit more I think.

Thanks again

moozie_2

Following on from the appointments, we chose a broker and went with the best deal that they came up with

Nationwide 5.22% fixed for 2 years with up to £500 pm over payment allowed

I hope this seems like a good deal to you too. We've had to drop our deposit to 5% as we could not find a property in our area under £170,000 The loan is £185,000 for a £200,000 property and although the monthly repayment is £1,120 it shouldn't be a problem as the joint net income is over £4,000 for our household.

I am now researching insurances so any tips or any comments on anything would be greatly appreciated. This is a steep learning curve for me and I am very careful with budgets/costs as I am doing so well with my debt repayments, I want to keep going and of course, I don't want the OH to incur any debt.

AndrewSmith

HI Moozie,

What are the insurances you are looking for information on?

Andy

payless

that shortfall in £5K deposit ( to hit 90%) menas the NW charges 0.4% extra for the 2 yrs ( roughly £1500 extra interest ) although at least they don't charge HLC ( higher lending charge- aka mig/ indemnity) which can often be £2 -3K

On the other hand on not saying it a bad rate for 2 yr fix over 90%

Joe_Bloggs

I think it is a good idea to plan where you would be when it comes to your next remortgage. Any thoughts ?
From were I stand my rate will be higher than moozies unless my brainwashing plan of the monetary policy committee works.
J_B.