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Independent Mortgage Advice
At BHP Home we want to provide you with help every step of the way.
An important part of any house move is securing the right mortgage to suit your needs. Whilst BHP Home is not regulated to provide mortgage advice we can put you in touch with an independent financial adviser within our parent law firm at BHP who are regulated by the Solicitors Regulation Authority and authorised and regulated by the Financial Services Authority.
Putting you in touch with an independent financial adviser means you can receive impartial advice on the best mortgage product to suit your needs.
Mortgages - making an informed choice
The mortgage market has changed dramatically over the last few years and the best deals are not necessarily available with your local building society branch. It is essential to seek advice from an independent financial adviser.
BHP have four qualified advisers including two who specialise in all types of mortgages.
The Process
Your first step is to establish how much you can borrow. This depends on several factors and no two lenders use exactly the same formula. In general, most lenders will lend between 3 and 3.5 times a single salary and 2.5 to 3 times joint income. It is important to establish the amount you may borrow and the cost at an early stage.
First Time Buyers
There are a number of mortgages aimed specially at first time buyers including 100% mortgages for those who have been unable to save a deposit. This is one of your most important purchases in your life and it is important that you receive specialist advice in respect of the many schemes available and the most suitable option for your circumstances.
Interest Rates
Investment Backed
Buy to Let Mortgages
Poor Credit
Re Mortgaging
The amount you decide to borrow also depends on how much the monthly repayments will be; this depends on the interest applicable at the time. Many lenders offer fixed rate mortgages, where the interest rate is fixed for a certain time period and will not change, even if the basic rate of interest goes up or down. Other deals available are cashback where generally the borrower pays full variable rate and receives an upfront cashback based on a percentage of the amount borrowed. There are also discount and tracker mortgages which go up and down depending on either a decision from the lender or the Bank of England base rate decision. Many of these deals carry an early redemption penalty but it is possible to arrange a scheme without such a penalty. There are advantages and disadvantages to all these deals and an adviser will go through these with you.
Repayment Methods
Capital & Interest
For shorter term borrowings and for those who do not wish to expose themselves to too many financial risks this option may be more suitable.
The monthly payment is calculated to cover interest and capital to the lender and provided you maintain payments for the entire term of the mortgage you are guaranteed to repay the loan.
The borrower pays interest only to the lender during the term of the mortgage and the mortgage is repaid via a “vehicle” which is generally established at the outset. The “vehicle” could be an endowment, an ISA or a pension. These vehicles all carry some degree of financial risk and will not suit everyone. On the other hand some offer tax advantages and are portable. Again it is essential that full advice is taken.
One of the fastest growing areas in the mortgage market, more and more lenders are providing buy to let mortgages and as a result the deals are becoming increasingly competitive. BHP are experienced in this field and can talk through your requirements.
Again this field has become more competitive over the last few years and although a poor credit history may mean that you will not have access to the entire market, it by no means precludes you from obtaining a mortgage.
BHP would be happy to discuss your situation in total confidence and source the best possible rate.
It may be that you are able to save money by simply switching from one lender to another. Of course this depends on several factors and of course it is always worth comparing what your existing lender would offer.
Protection
When you take any mortgage is it important that you consider what is needed to protect against death or critical illness to repay the full loan. Should illness or unemployment occur, Payment Protection can cover monthly outgoings. For home owners buildings and contents insurance is a must. There are a range of useful BHP free guides on financial planning topics.