Simple question Mortgage Rate

Therooster100

I have what I think is a simple question but just want to clarify:

I have put a deposit down on a New Build house that won't be ready until the end of August.
If I get a MIP for a 5 year fixed & then get accepted for the mortgage in say April what would happen if the interest rates rise in May? Would this increase my mortgage rate as I won't start it until August?

kingstreet

Once you have a formal mortgage offer for a product, it holds until expiry date, regardless of rate changes.

An agreement in principle is not normally sufficient to guarantee a rate. A full application is usually required.

A newbuild will normally see you needing to exchange contracts in 28 days, so you won't be waiting to apply for the mortgage.

juniordoc

New builds are also notorious for not being completed on time so don't be too hasty submitting a full application.
But you will be at the mercy of interest rate rises until you do.

Therooster100

So if I was to do a at the start of April with a view to get accepted end of April that would lock in the rate until November (6 months from MIP) so if it did slip behind a couple of months I would be okay?

kingstreet

Ability to extend an offer varies from lender to lender.

An offer will usually last six months from the date of the valuation, but some lenders will simply do a valuation refresh, ask you to pick a new product and issue another six month offer.

Do you have a broker managing this for you, or are you trying to DIY?

Therooster100

I don't have a broker as of yet as I think it might be slightly to early
I will probably go with one as we are first time buyers and on the young side of things!