97% mortgage - anyone other than Halifax?

RubyShoes

I have been searching for a home for 2 years, over the time I have had so much mortgage advice, and have come to the conclusion that I need to avoid mortgage broker's (for my own peace of mind!)

I have had bad experiences with Mortgage Advice Bureau, Contrywide and London & Country.

I do not wish to repeat them!

Therefore, I am trying to do this myself.

homer_j_3

Your bad experiences, may have just been that your expectations were not met. I am not sure whether MAB do face to face or telephone based advice but we hear mixed reports on L&C.

If you have the house sorted, offer agreed and have an idea what sort of product that you want, it should be pretty easy for a local whole of market adviser to sit down with you and sort it out for you.

If you decide to go on your own, good luck and I am sure you will learn a bit. Just ensure that you read all Illustrations fully as these hidden nasties such as HLC's are not uncommon.

RubyShoes

Where would I find out about the HLC? At what point should it be made clear to me?

homer_j_3

You don't sound like the person who should be doing this alone.

You will get all the information that the lender needs to disclose in the Key Features Illustration.

You need to consider a number of factors in ensuring that the best product is found and if you are searching Best Buy tables and just looking at lenders directly, then you will need to bear in mind that not all the relevant infromation will always contained on the websites - As you have found out with the Halifax

dunstonh

I have had bad experiences with Mortgage Advice Bureau, Contrywide and London & Country.

You are a first time buyer who has been looking for over 2 years. How can you have had a bad experience with 3 brokers?

As homer says, maybe it is your expectation. As you have not got a property, many mortgage advisers will not be interested in spending much time with you. Especially the internet/direct based ones. A local broker would be a better bet but even then there will only be so much you can expect them to do.

There is no point discussing deals in any detail. Beyond telling you what you can expect to be able to borrow, a rough indication of costs and what to expect there is little more they can do.

and have come to the conclusion that I need to avoid mortgage broker's (for my own peace of mind!)

I have come to the conclusion that a whole of market/independent mortgage adviser is exactly what you need (and note that I am an IFA and not a mortgage adviser). You have some info but lack the depth of knowledge and ability to find the deal to suit your needs.

MortgageMamma

Just to add to homerj and dunstonh's general comments, you need to realise that the first mortgage you take is ALWAYS the most important one. If you mess up with this one then it can affect your financial situation for years to come. Get it right, your laughing.

Try using someone local and self employed. Tends to be the best way.

RubyShoes

I have found a property - my offer has been accepted.

I have tried to buy 2 properties before this one - one 2 years ago, and one 4 months ago. Both fell through due to bad advice from mortgage brokers. The 2nd one in particular, I am still quite angry with.

I can assure you, its not any high expectations that I have. Its been wrong advice, and pure lies fed to me (again, particularly though the last attempt at buying) that have caused me to have extreme suspision of mortgage advisers.

Maybe I will give them one last go. I don't know. I am not keen on the idea though.

herbiesjp

GIve a little explanation to the two failed purchases and maybe those of us here on the board can help pinpoint the problems with those, and maybe highlight problems with this purchase before they happen

MarkyMarkD

RubyShoes wrote: »

Really? Having just checked Nationwide, if I had a 95% mortgage - I could get a rate of 6.03% on a 5 year fixed rate. Reservation fee is £499.

Is it more expensive?

The reason the Nationwide advert is misleading is that it suggests that it's always worse to have an HLC than anything else. And that simply is not true.

Nationwide charge an extra 0.40% per year for 5 years on the product you are talking about - 6.03% instead of 5.63%. So their "pseudo-HLC" is costing you 2% of the amount you borrow or £2,000 on a £100,000 mortgage at 95% LTV.

Other lenders charge an HLC of around 7.5% of the amount borrowed over 75% LTV - i.e. on 20% of your property value - meaning an HLC of 1.5% of the property value. A £100,000 95% LTV mortgage would equate to a property value of £105,263, and the HLC would cost £1,579.

Hence why I point out that HLC is not necessarily worse than Nationwide's pseudo-HLC.

Anyone opting for Nationwide's 10 or 25 year fixes is paying even more over the odds in pseudo-HLC.

Looking at MoneyFacts best buys for fixed rates, you could get 5.48% with a £399 fee from the Post Office. So for starters, that's 0.15% a year and £100 cheaper than Nationwide's standard (<90% LTV) product.

If you believe Nationwide's "HLC is bad" lies, you might think - ah, but, they'll rip me off because of HLC because only Nationwide are different.

But Post Office don't even charge HLC!

So the Post Office deal is 0.55% a year and £100 up-front cheaper than the Nationwide one.

There are almost always better deals available than from Nationwide - they simply out-spend many others on marketing.

PasturesNew

HLC is only a pseudo-MIG.
I wonder if we'll start seeing the rise of MIGs again as happened in the last crash.