Tag Archives: Mortgage broker London

The mortgage process – what’s involved

Mortgage process

Sarah Logeswaran, a first-time buyer from London, recently sent Springtide Capital some positive feedback as follows:

“Springtide Capital’s extensive knowledge and experience, coupled with their approachable and friendly nature, really eased me through the process of purchasing my first home.”

We thrive on feedback at Springtide Capital, as it helps us to continually improve the service we offer.  We’re thrilled that Sarah was happy with the high level of service she received and it’s something we strive for with all our clients, as we know that getting a mortgage is one of the most stressful things you can go through. We’re proud of the service we give and that’s why we’d like to help new clients to understand what they can expect from us when purchasing their first property.

Henry Knight, Director of Springtide Capital has also provided his tips on key broker qualities.

  1. The initial meeting

A client’s perspective: The client initially approaches Springtide Capital to obtain a mortgage for a property they have set their sights on. Although the majority of clients are savvy with their finances, the mortgage market is baffling and clients often require guidance on what they can afford and the types of mortgages available. Non-advised sales of mortgages are now not available so a client must seek financial advice.

Moreover, clients usually prefer face-to-face meetings with a broker, rather than a call centre adviser, due to the private nature of the questions, which must be answered. It also provides the client with more options, as the broker isn’t tied to a specific lender, and gives them a point of contact to guide them through the mortgage process.

A face-to-face meeting is then arranged and our Mortgage Consultant will go through their client’s requirements, financial situation and explains the application process and the types of mortgages available.

Springtide Capital’s perspective: The mortgage industry is heavily regulated, and it’s vital that the Mortgage Consultant can demonstrate (document) that any recommended mortgage fits his/her client’s personal circumstances and is affordable in the event of rate rises – protecting the client.

Henry’s tip: “A mortgage consultant should take the time to understand a client’s circumstances on the first meeting. They must then clearly explain the process and then make sure the client understands the financial commitment they’re undertaking.”

  1. The key facts documents

A client’s perspective: The client will then receive a Key Facts Illustration (KFI) document, explaining, in detail, the type of mortgage recommended (including interest rate, the overall Annual Percentage Rate of Charge (APRC), the monthly payment and any fees), the total amount payable over the term of the mortgage and next steps they’ll go through if they wish to proceed.

Springtide Capital’s perspective: This is where our Mortgage Consultant’s experience really comes into play. Using all of their knowledge of the market, regulation and lender relationships they will have researched the deals available that best fits the client’s needs before issuing a KFI. They will also take into account any additional challenges that the client may face when applying for the mortgage e.g. any restrictions they might have that could make getting a mortgage difficult and place the business with lenders who specialise in such cases.

Henry’s tip:“A mortgage consultant should have an in-depth understanding of the mortgage market in order to find a mortgage which best fits the client’s circumstances. They also need to know how to structure a proposal to a mortgage lender especially where the client’s circumstances are outside of the standard criteria.“

  1. The Agreement In Principle (AIP)

A client’s perspective: The client is given an AIP by the lender and details are sent out to read and discuss with the Mortgage Consultant. The client can then place an offer on the property. Once the offer on the property is agreed, our Mortgage Consultant will then submit a formal application with full information to the lender.

Springtide Capital’s perspective: This is a crucial part of the process as an AIP is only based on information provided by the client. To obtain a mortgage the Mortgage Consultant must then evidence the facts provided by his/her client e.g. proof of income, bank statements etc. It’s then vital that everyone in the process is kept up to date with progress until exchange of contracts and money is transferred from the lender. This is often the most stressful part of the mortgage process and that’s where our Mortgage Consultants really come into their own. They will liaise with their client, the lender, solicitor and estate agent to ensure that all the documentation is received and will often be the first point of contact if things don’t go as smoothly as planned. They will work hard with all parties to make sure their client gets the resolution they need, with as little hassle as possible.

Henry’s tip:“A mortgage consultant should keep all parties updated with progress, whether they are the client, lender, estate agent or solicitor. They should be available throughout the process and proactively resolve any problems that crop up.”

 

If you would like to speak to a Springtide Capital mortgage broker please call

020 3040 4400.

Gross mortgage lending down 5% year-on-year

Henry Knight, Director, Springtide Capital

Henry Knight, Director, Springtide Capital

According to the latest Council of Mortgage Lender’s (CML) market commentary, gross mortgage lending reached £20.6 billion in October, which is a decrease of 5% year-on-year.

Report highlights also included:

  • Economy holding up better than expected
  • Monetary Policy Committee (MPC) left interest rates unchanged

THE ECONOMY

Economic data has now revealed that the UK’s post-referendum economic landscape is stronger than expected.

The Office for National Statistics (ONS) reported that the economy has grown by 0.5% compared to the three months to June. In addition, the ONS also reported that unemployment rate fell to 4.8% and that inflation has dipped to 0.9%. In response to this, the Bank’s November Inflation Report, expects inflation to reach 2.7% by the end of 2017.

The Monetary Policy Committee (MPC) voted to keep the interest rate at 0.25%.

HOUSING MARKETS

Gross mortgage lending in October totalled £20.6 billion and is 5% lower than October last year (£21.8 billion).Gross lending for the whole of 2016 will be between £240-245 billion, which would represent a 10-12% rise compared to 2015.

Better than expected, house purchase approvals reached nearly 63,000, prompting the Bank of England to revise up its forecast for approvals from 56,000 to 65,000.

Finally, tightened affordability criteria and recent stamp duty changes have meant softer buy-to-let activity overall. The mix of lending has slowly moved towards remortgage activity, accounting for 40% of lending against a third in recent years.

Henry Knight, Managing Director, Springtide Capital added: “It’s great to finally see data detailing that the UK’s economy is stronger than expected as this will perhaps allay fears of economic uncertainty in the market. However, the lack of available properties now seems to be compounded by subdued home-mover activity meaning demand continues to outstrip supply.”

Commenting on market conditions in this month’s market commentary, CML senior economist Mohammad Jamei said:

“The housing market has continued to fare better than many expected, with survey indicators still painting a relatively positive picture. The Royal Institution of Chartered Surveyors survey showed demand holding up well.

“The problem is that this demand is still not being met with a supply response. New instructions to sell have fallen, or been relatively flat for more than three years now. This has led to the average number of properties per surveyor falling to its lowest level for nearly 40 years.The impact of this is that it limits the number of potential transactions, as well as pushing up prices, as the relatively few properties up for sale are bid up by a growing number of buyers.”

If you would like to speak to a Springtide Capital mortgage broker please call 020 3040 4400.

 

Source: https://www.cml.org.uk/news/news-and-views/market-commentary-november-2016/