These days, you can do just about anything online.
From ordering your groceries, to finding old pictures of friends, to looking for the best deal on that dream trip, there’s barely anything you can’t do from the comfort of your own home as long as you have a stable internet connection. Why should finding the right mortgage be an exception?
While there are plenty of physical services like mortgage brokers or advisers in banks and building societies, there are also a plethora of online tools specifically designed to help you find the right mortgage product. While many prefer to talk to real people when dealing with financial matters, just as many love being able to do all they can on a computer or smartphone. Some prefer a mix of both! No way is superior to the other.
Whichever side you’re on, it’s important to do as much research as you can before you even start your application. As one of the most significant financial commitments of your life, you want to be prepared when looking for mortgages online.
Work Out Your Budget
There’s more that goes into a housing budget then you might think at first. Of course, you’ll need a sizable amount of money to show to potential lenders that you have the resources to keep up your repayments, but there’s a lot more on top of that.
Saving up such a large amount of money is one of the most challenging aspects of buying a home, and many people wonder how much they should be saving. This will entirely depend on the approximate cost of the home you want and the type of mortgage you’re applying for. Remember, the more of a deposit you put down, the more deals will be available to you.
A lot of people forget about this tax. Legally, Stamp Duty is there as proof that you now own your new property, but not everyone will have to pay. If you’re a first-time buyer in England or Northern Ireland, then you will not have to pay as long as you are buying a property under £300,000. For everyone else, you’ll be paying between 2% and 12% of your property’s value, depending on the purchase price. There are plenty of online mortgage calculators that can also tell you how much Stamp Duty you’ll owe.
A small fee (£99-£250) is sometimes charged when you apply for your mortgage deal. Unfortunately, it’s usually non-refundable even if your mortgage falls through.
This is sometimes known as the completion fee or product fee and is a charge for the mortgage product. It can sometimes be added on top of your mortgage but will add to the interest charge.
Most mortgage providers will want to value the property before approving your application. This is to see that you’re borrowing the correct amount. (It’s usually £150-£1,500 depending on the value of your property).
Mortgage Broker Fee
If you enlist the help of a mortgage broker, most will charge a fee for their service. How much will depend entirely on the type of service you ask from them, but all good brokers will be upfront about their charges before you start.
These are only a few of the potential fees that could pile up when buying a new home. Luckily, you can research them online as well as utilising a number of tools that can calculate how much you’ll owe for each cost.
Try an Online Mortgage Broker
If you’re unsure about any aspect of the mortgage application process, then using a mortgage broker could help. Mortgage brokers exist in two forms: Physical and online. While physical mortgage brokers have many advantages, some people prefer doing all they can online. There are plenty of reasons to use an online adviser.
One of the best things about the internet is that it never sleeps. Websites don’t close at 5 PM, so your browsing never has to stop. Many of us have jobs with weird hours or don’t have time to go to these types of services during regular business hours, so online services make a great alternative.
Quick and Easy
Online mortgage brokers often have a real element of speed. A lot of online mortgage brokers are even partly or fully automated. Most only need a few details like your budget, property value and if you’re a first-time buyer and will then compare 1000s of deals and recommend you the best ones.
A Wide Coverage of Mortgage Products
Not only will they only have a small number of mortgage products available, but they definitely won’t suggest a better rate at one of their competitors. A mortgage broker must be objective. They will have access to thousands of deals across the market and be able to find the ones that are best for you.
Most physical brokers will charge a fee for their services but, as of 2016, all online brokers are initially free to use. Usually, you won’t have to pay to get a general overview of deals you could be available for you. However, there are some circumstances where a physical mortgage broker may be the better option for you.
If You Have a Complicated Financial Situation
Plenty of us don’t have a straightforward financial history, which means finding a mortgage deal can be a bit trickier. Most online services don’t ask for a detailed history, so may offer deals that you might not actually be eligible for. This is where a physical broker could be a better choice, as they’ll be able to go into your finances in more detail and find deals better tailored to your situation.
If You are Very Unsure
If you’re incredibly uncertain about any aspects of the mortgage application, then it may be best to talk to an actual human. Online brokers are great for a general overview, but if you have more complicated questions, then a traditional broker should be able to straighten you out. You might not even have to make an appointment, just make a quick phone call.
A mortgage is a big commitment. Whether you prefer doing things online or talking to someone face to face, make sure you’re doing all the research and preparation that you can before you apply. If you end up with a bad deal, it could end up leading you down a terrible financial path and be hard to get out of.