Mortgage in Principle - first time buyer, which bank?

Velja

Dear money savers,

I need some advice as to which bank to approach for a MIP. We are first time buyers and bank with HSBC but have been put off by friends/media stories of how harsh they are on affordability.
Someone suggested first direct but as they are an online bank only I couldn't see on their website whether they provide mortgage in principle. Which I thought is needed when viewing houses.

Any help will be greatly appreciated.

betmunch

Go with the bank that currently offers you the best product that you can qualify for, and matches your requirements.

If you dont know which one this is, employ someone to do it for you.

Velja

Thanks, we don't have debts or bad credit history but worried that HSBC will waste our time and then deny us mortgage. This is generally the advice we have been given by two other couples who then went elsewhere.

betmunch

Its a very common story.

You should work out which product and lender you would go with as if you had an offer accepted today and get your AIP with them.

If you did that would it be HSBC, First Direct, or someone else?

Again, if you do not know you need to use a broker who will take responsibility for you

Malmo

Worth reading the information about brokers at this MSE link.

Then, once you are ready to search for a broker, try starting a local broker search at unbiased.co.uk.

On the home page, next to the search box, select Mortgage Adviser and enter your postcode and hit search.

When the search results are displayed, in the filters on the left hand side:
Un-tick the Only show sponsored results box
Expand the heading More filters and under Adviser restrictions, tick the box for Mortgage Broker (Whole of Market). This should give you a list of potential brokers to contact in your locality.

Make sure you understand from the brokers you speak to what fees will be charged and at what point in the process. Ideally (based on my personal experience), they'll email you a couple of documents; 1) their Terms of Business, which will outline/summarise the service they provide and their fees; 2) a Fact Find document that you need to complete to help them understand your full circumstances & requirements.

Velja

Thank you for advice and helpful links.
Can I just check if first direct provide the AIP certificates as I was told you need to take them with you when viewing a house.
Forgive the ignorance but neither of us have been to a viewing so feeling a bit out of depth now..

glasgowgirl80

I can't say for first direct, but when I started looking my broker got me a decision in principle from Halifax in the first instance. Apparently Halifax are a common one to go for initially because they don't do a full credit search at DIP stage so it only leaves a soft footprint on your credit file. There are pros and cons to this obviously because they then might discover something at full search stage which would rule you out to them, but I just needed a DIP to proceed with reserving a new build.

You don't then need to go with Halifax, I am but that's for other reasons.

glasgowgirl80

Forgot to say - I am an ex HSBC mortgage customer and yes they are tough on affordability. I have heard that First Direct are even stricter, but that's just hearsay.

Thrugelmir

Velja wrote: »

Thanks, we don't have debts or bad credit history but worried that HSBC will waste our time and then deny us mortgage. This is generally the advice we have been given by two other couples who then went elsewhere.

HSBC like other lenders. Have target markets for their products. To avoid wasting time make general enquiries before submitting an application. HSBC have high income requirements (£50k sole, £75k joint) which is part why they offer highly competitive rates. There's no right to a mortgage. Lending money is a two way business relationship.

Velja

Will do, thank you all for your help.

Velja

After much deliberations we decided to apply for MIP with HSBC. Will let you know how it goes..
Anxious times..
But everyone has been so helpful. Thank you.