First time buyer - need some help please

browniej

Just starting to look around at properties and need a lot of help as this is my first home.

I'm looking at properties up to a £100k and have around £15k to £20k as a deposit - depends on how much I need for fees etc.

General opinion on here seems to be to get an independent mortgage broker who takes no fee - anyone recommend someone in Glasgow area?

However I've also had a look at moneysupermarket.com and noticed the First Direct 2 or 5 year fixed deal coming up a lot so went to have a look at their website. Now I'm lost.

Some questions on the First Direct offering;

1. If I took the 5 year fix and wanted to move house within that 5 years, what happens? It talked about the mortgage not being "portable" - what does that mean?

2. 5 yr fix at 4.99% seemed good. 2 yr fix offered 5.25% or 4.75% - however fees for the 4.75% seemed very high (£999 arrangement fee and £499 booking fee )

3. Both are offset mortgages - if I don't have any savings ( will use them all up to get the house) to offset can I still apply for this?

4. Lastly will a mortgage broker be able to offer any better?

Would be grateful for all the help I can get here as I don't have a clue what it's all about.

mortgage_broker_advisor

1) Portable means if you move house you can transfer your current mortgage to the new house.
2) Only you can decided on that.
3)Yes
4) maybe

MortgagesInc

"If you are looking for a broker on here to contact you they cant, but you are allowed to PM brokers and ask for advice.

I am based on the south coast"

Pushing the boundaries there I think mortgage broker advisor

browniej

mortgage_broker_advisor wrote: »

1) Portable means if you move house you can transfer your current mortgage to the new house.
2) Only you can decided on that.
3)Yes
4) maybe

Thanks for that.

by the way money supermarket will sell your details to a broker for about £30. If you are looking for a broker on here to contact you they cant, but you are allowed to PM brokers and ask for advice.

I am based on the south coast

Bit too far to travel for a mortgage.

dweeby

browniej wrote: »

However I've also had a look at moneysupermarket.com and noticed the First Direct 2 or 5 year fixed deal coming up a lot so went to have a look at their website. Now I'm lost.

My application to First Direct for an £87k 4.99% fixed for 5 years just went in the post this morning. As far as I can establish (and I have consulted with mortgage advisors), it's unbeatable - if your credit record etc. are ok.

First Direct products aren't available to brokers, so they can't recommend them. L&C mortgage brokers, who come recommented by Martin Lewis quoted me an Alliance and Leicester 5 year at 5.68%, supposedly after searching the whole market...

With First Direct, you can make overpayments (with no charge), you can draw back your overpayments (with no charge), set-up fees are low. Unbeatable from what I could establish.

Don't ask for a broker recommendation, I did, and I got flamed.

Good luck, anyway!

InMyDreams

2) you need to look at the total cost over the fixed period. Ring them up and ask them to quote you how much the monthly repayments will be. Multiply by 24 months and add on the fees. This will tell you which deal works out cheaper over the two years. It will depend on the size of your mortgage. Also take into consideration how you are going to pay the fees.

4) it's easy to ring a few and ask. I picked up my yellow pages and phoned a couple. I told them up front what I'd found myself. One phoned me back to admit he couldn't do better. The other didn't phone back at all. But if you are buying your first house, depending on how savy and knowledgeable you are, I think talking to a mortgage adviser might well be worth it anyway. You don't want to waste a credit search applying for a mortgage that you haven't a chance of being granted, whether it's becasue of affordability, salary multiples, LTV, credit history, whatever. I think this is where mortgage advisers are most useful. Anyone can scour the best buy tables, which is fine if you are confident that all those mortgages would be available to you in your situation.

homer_j_3

If you want to receive independent advice then you have to pay a fee.

You may be getting confused with Whole of Market advice but even then you may not be getting the fullest of choices as dweeby states. Some of the advisers on here will look at products that do not pay a commission and will do them for free still because they look for the long term relationship, however, most will want paying if you want them to look at these lenders too.

It is very frustrating that the FSA has not made this process simpler to understand to the public. If you are Whole of Market you should have to have access to every lender that will accept broker business. There should be a disclaimer on the Key Facts stating that certain lenders are not being searched for this reason. Unfortunately, as things stand, you could have access to 10 lenders and call yourself Whole of Market.

My advice would be to ask friends, colleagues and relatives for names and numbers and then ring around.

If you are struggling there then you need to maybe look in the yellow pagers or google maybe for advisers in your local area.

browniej

dweeby wrote: »

My application to First Direct for an £87k 4.99% fixed for 5 years just went in the post this morning. As far as I can establish (and I have consulted with mortgage advisors), it's unbeatable - if your credit record etc. are ok.

I'm not sure the 5 yr fix would be good as i don't know how long it would be before I try to move onto something bigger. What happens if you do want to move house?

browniej

homer_j wrote: »

If you want to receive independent advice then you have to pay a fee.

You may be getting confused with Whole of Market advice but even then you may not be getting the fullest of choices as dweeby states. Some of the advisers on here will look at products that do not pay a commission and will do them for free still because they look for the long term relationship, however, most will want paying if you want them to look at these lenders too.

Probably am getting confused here.

So how many lenders would a good whole of market, working on commission, be able to choose from?

homer_j_3

Well its difficult to say that a set amount of lenders would be good. Ideally you want to find someone that would look at every lender including those not in the broker side of things. Most advisers will want to charge you a fee for this and providing it did not exceed 0.3-0.5% I think it would be good value for money. If you can find someone to do that for free, clearly even better.

If you are just wanting to ensure your broker has a good wide choice then I would say that if the broker has access to more than 50 lenders then there should be a good choice there for you. What I would recommend though is that you do is ask the broker to supply/print you off you a list of lenders that they will research. That will give you the honest answer when trying to see how whole of market they are.

I used to get the local estate agent stating that they were representative of the whole of market and they offered access to 15 lenders and could not go off this list to any other lender. They were not breaking any rules by saying this as they covered the requirements of the regulatory body, however, I do not feel that this is treating customers fairly.

You need transparency in these matters and unfortunately the only way you will fully understand the scope of a mortgage adviser and the lenders they research is by asking for a list of the lenders they use. Try and look past the WOM sign if you can.

dweeby

browniej wrote: »

I'm not sure the 5 yr fix would be good as i don't know how long it would be before I try to move onto something bigger. What happens if you do want to move house?

This wasn't an issue to us, as the house we're buying is big enough to bury me in the garden (hmm... hope my wife doesn't reallise this!)!!

However, the people who answer the phone and take your enquiry at First Direct are very knowledgeable about their products - so just ask them. Because of the rates they offer, they're very busy at the moment - they'll book a time and call you back.

Incidentally, a mortgage broker that is highly recommended by this website is L&C, click here for their website (I have no affiliation). But they didn't find a particularly good deal for me, but they are non-fee "whole of market" mortgage brokers. They do have some good tables on the website comparing different rates etc (I think they have the First Direct ones listed even tho' they can't use them).