Forum Home» Mortgages & Endowments

First time buyer/low LTV advice

New Post Advanced Search

First time buyer/low LTV advice

edited 30 November -1 at 1:00AM in Mortgages & Endowments
8 replies 955 views
theallamtheallam Forumite
5 posts
edited 30 November -1 at 1:00AM in Mortgages & Endowments
First time buyer in the UK here. I've found a nice house in my hometown, offer's been accepted, and I only need a mortgage of 35k (15% of the property's value.) Currently in the shopping around stage. As I know I'm in quite a rare position, I just wondered if anyone could offer their 2 cents on a few things...

-Is it worth paying for a mortgage broker? If I was borrowing a large LTV I wouldn't dare go without independent professional advice, but nowadays with online resources I'm wondering if it might not be necessary in my situation.

-Any insights on the best lenders to go with? Heard good things about Nationwide and Halifax.

-Is it better to go with a shorter fixed rate over a 10 year one? Especially with Brexit to look forward to soon...


Any help would be much appreciated 🙂

Replies

  • I would always say instruct a broker, they are worth their weight in gold not only for the advice but pushing things through to completion. In my experience the likes of Nationwide and Halifax will not be offering the most competitive products currently. Preferences around fixed rates are down to your personal feelings and the type of person you are and what is going to make you feel comfortable.
    I am a Mortgage Broker
    You should note that this site doesn't check my status as a Mortgage Broker, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.
  • Why would you go with a shorter fix given there is short-term uncertainty.


    In your position I would opt for a long as fix as I could, given a) rates have never been lower and b) there is a lot of short-term uncertainty on the horizon.


    Given the low value of the mortgage could you get a ten-year duration and a ten year fix? then you would know your entire costs and have no risk on that payment rising.
    Thinking critically since 1996....
  • ACGACG Forumite
    20.6K posts
    Tenth Anniversary 10,000 Posts Name Dropper I've helped Parliament
    ✭✭✭✭✭
    How long do you plan on keeping the Mortgage for? If less than 10 years then I would probably rule out a 10 year fix. If over 10 years, its a discussion worth having. There are not many 10 year fixes around so they are unlikely to be competitive.
    Any other debts?
    Straightforward income?
    Any bad credit or quirks for you or the property?

    As another poster said, Nationwide/Halifax are not exactly leading the way on cheapest deals at the moment. They can be flexible for certain things, but if you do not need flexible then you should be chasing the deal (not the rate).

    As for whether you should use a broker, it depends what you want. We are not a price comparison service and I suspect most brokers are going to want paying on a deal that size. A brokers job is to take it all out of your hands and deal with everything.

    If you have no complications then I would say do it yourself if you feel confident enough and have the time to.
    I am a Mortgage Adviser
    You should note that this site doesn't check my status as a mortgage adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.
  • kingstreetkingstreet Forumite
    36.4K posts
    Ninth Anniversary 10,000 Posts Photogenic I've helped Parliament
    ✭✭✭✭✭
    On that size mortgage, I'd be looking for a free valuation, no product fee and a cashback as they will outweigh any savings from a lower rated product.
    I am a mortgage broker. You should note that this site doesn't check my status as a Mortgage Adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice. Please do not send PMs asking for one-to-one-advice, or representation.
  • ACG wrote: »
    How long do you plan on keeping the Mortgage for? If less than 10 years then I would probably rule out a 10 year fix. If over 10 years, its a discussion worth having. There are not many 10 year fixes around so they are unlikely to be competitive.
    Any other debts?
    Straightforward income?
    Any bad credit or quirks for you or the property?

    As another poster said, Nationwide/Halifax are not exactly leading the way on cheapest deals at the moment. They can be flexible for certain things, but if you do not need flexible then you should be chasing the deal (not the rate).

    As for whether you should use a broker, it depends what you want. We are not a price comparison service and I suspect most brokers are going to want paying on a deal that size. A brokers job is to take it all out of your hands and deal with everything.

    If you have no complications then I would say do it yourself if you feel confident enough and have the time to.

    Gonna go for 20 years, hopefully I can pay it off a bit earlier. But I'm thinking 10 years is a long time to fix for, my situation could of course change in terms of work and family.

    My credit's fine, no debt, and the house seems in very good condition. Income is consistent.
  • kingstreet wrote: »
    On that size mortgage, I'd be looking for a free valuation, no product fee and a cashback as they will outweigh any savings from a lower rated product.

    Thanks, that's a great point. The price comparisons I've done definitely back that up.
  • AnotherJoeAnotherJoe Forumite
    18K posts
    10,000 Posts Fourth Anniversary Name Dropper Photogenic
    ✭✭✭✭✭
    Why would you go with a shorter fix given there is short-term uncertainty.
    Theres always short term uncertainty. And medium term. And long term.
    In your position I would opt for a long as fix as I could, given a) rates have never been lower and b) there is a lot of short-term uncertainty on the horizon.

    Actually, rates have been lower. As recently as a couple of months ago.

    And if anything, Brexit is more likely to mandate lower rates, not higher.



    Given the low value of the mortgage could you get a ten-year duration and a ten year fix? then you would know your entire costs and have no risk on that payment rising.


    With such a small mortgage, it would take a massive rise in rates to make any real difference. For example 2.5% to 4% is just £27 a month more. If the OP cant afford that dont buy a house.

    And finally, a 10 year fix is going to likely land them with a disproportionately large ERC for little real gain.
  • ACGACG Forumite
    20.6K posts
    Tenth Anniversary 10,000 Posts Name Dropper I've helped Parliament
    ✭✭✭✭✭
    AnotherJoe - I was at a conference earlier this week. 2 of the 5 lenders there said they are looking to improve their criteria and look at different markets because at the minute they are not looking to lower their rates any more when they can lend it out elsewhere at higher margins.

    One of the lenders was looking at lending to Ltd Company BTLs (which they do not currently do), another was looking to get in to commercial lending... Although 3 days later I receive and email from one of those lenders where they had knocked around 0.1-0.2% of 2 of their deals.

    I do get the impression rates are probably as low as they will go with maybe the odd tweak here and there (up and down) depending on how business volumes dictate.
    I am a Mortgage Adviser
    You should note that this site doesn't check my status as a mortgage adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.
Sign In or Register to comment.

Quick links

Essential Money | Who & Where are you? | Work & Benefits | Household and travel | Shopping & Freebies | About MSE | The MoneySavers Arms | Covid-19 & Coronavirus Support