Most of the time, finding your dream home is the easiest part of buying a home. When you find a place you want to make an offer on, you'll need to move quickly. So, it helps to have your mortgage in order before you look for a place to buy.
Before you even start looking for a house, you can choose a lender and a mortgage, apply for the loan, and get your mortgage "approved in principle." This means that you know how much money you will have and can be pretty sure that your mortgage will be approved. Still, the lender will want to see the valuation survey, and there may be other checks that need to be done before the deal can be finalised.
People used to get mortgages from building societies or banks, but now there are a number of other options to think about. Smaller, specialised mortgage companies can sometimes offer better deals and be more flexible with terms.
Building societies and banks
Since the market has become much more competitive, the bigger banks have changed their ways and made their mortgage deals much more flexible. You'll know that your mortgage is coming from a reputable lender, and having local branches can make your day-to-day banking easier.
Insurance Companies
Some companies now have their own mortgage products, which can have good terms, as well as insurance products and investments. One well-known example is Legal and General. Check to see if you are required to get insurance from the lender if you want to get a mortgage.
Specialized and Centralized Lenders
Most of the time, this type of lender only has one location. You won't be able to visit a branch, but they may have lower rates because they don't have as many costs to pay. Virgin Direct and Mortgage Trust are two lenders that can give mortgages with a lot of flexibility. This kind of borrowing is easier because you can do it over the phone or online.
Local government
People who live in council houses might want to ask their local government for a mortgage. People who want to fix up abandoned houses can also get mortgages from some government agencies. Talk to your local council to find out more.
It's a good idea for a lender to sign up for the Mortgage Code, which is a voluntary programme that means the lender has agreed to provide good service.
