While having children or getting married may be looked upon as the biggest decisions in life by many people looking from an emotional standpoint, one thing’s for sure: if you look at things economically, the issue of buying a house is probably the largest commitment you’ll ever make. It’s not just a case of the astronomical amount of money involved in the deal, either; the process is long, full of hurdles and often outright exhausting.
As such, you need to approach the situation with a well-prepared attitude. While it’s obviously very necessary to pick the best property for you, you really need to prioritise getting the best mortgage to go with it, whether it’s with a building society that specialises in the local area or a conglomerate dealing in properties around the globe.
The first thing you need to do is carry out plenty of research. You first need to assess how much you can realistically afford to invest in your home loan every month (and annually, too). You need to list times when spending can get tighter, but also when you’re a little better-off. Make worst-case scenarios to understand how long you would last, say, without a job or regular income. You cannot underestimate how much this long-term agreement could change over time – mortgages don’t take years to pay off, but decades.
Write down your take-home pay, credit card repayments, bills for electricity and gas, as well as food prices. Don’t forget the small things, either, such as phone bills or monthly subscriptions. Consider if you may even start a family or get a second car; the possibility of getting a loan may also be quite a big-impact decision in future.
Start looking at mortgage deals with a simple online comparison tool. These should be used with caution, though; if you see anything specific that you want, see an adviser about it. Don’t take these sites’ deals as the best, though – the better deals will be offered directly from lenders themselves. Local banks and building societies, who know the market better, may also be willing to give you a better deal, owing to their better understanding of the area in question.
From here, speak to mortgage advisers. These are your lifeline, but certainly not infallible; they need to do their job properly and give you the advice you need or want. In the opening stages of this consultation, make sure the adviser explains the service they offer by using an initial disclosure document. They also need to confirm your position, so talk in detail with them about your income, debts and outgoings, as well as projections for how these may change in future.
A mortgage adviser will then compile a definitive list of deals available to you, then tell you what they think is the most suitable. Everything should be compiled in a key facts illustration (KFI) document, so you can understand what will best benefit you.
This is far from the end of the mortgage-buying process, but it will help you to understand what’s expected in the early stages. So long as you have all the important documentation, your mortgage should go through well, subject to the usual credit checks and compliance from the people (or bank) you buy your dream house from!