Guide to mortgages in the UK

Strict vigilance will be necessary to ward away any untoward repercussions on the future. Mortgage is a legal term with a heavy impact on the finances of the borrower. Ignorance of law is no excuse. There are frequent changes in the mortgage market with constant additions and deletions in the rules governing the mortgages. The rules that were prevalent a few decades ago may have become outdated now.

Expecting the borrowers to be conversant in the rules related to mortgages will be unjustifiable. They are already burdened with their jobs. Trying to gain knowledge of the mortgages may divert their energies to tasks other than their core areas of operations.

However, a basic knowledge of the mortgages will be necessary in order to save oneself from the hands of scheming lenders.

Independent financial advisors provide vital information about the mortgages. The advice provided by them is unbiased and not inclining towards any particular lender. Independent financial advisors provide advice on general mortgages as well as specific mortgages to deal with specific requirements. Association of Independent Financial Advisors, representing independent financial advisors all over the UK helps borrowers find a local advisor.

Many a times lending organizations offer valuable advice in the form of the term of repayment, method of charging interest, etc. However the borrower must have the knack of differentiating between valuable advice and marketing products.

Perplexity for those taking mortgages further increases because of the vast multitude of terms associated with them. Mortgages are available for practically every purpose and for different classes of people. The people who are buying homes for the first time can have a first time buyer mortgage. Those planning to benefit from the equity in ones home but not repay the amount received, can take a reverse mortgage. Right to buy mortgages caters to the council tenants only, who are planning to buy their council homes.

The next decision to be made is regarding the amount of mortgage. The amount of mortgage will differ with the lenders and the type of mortgage taken. The risk involved in a mortgage deal will also decide the amount of mortgage allowed to the borrower. Mortgagors or borrowers have to extend a certain percentage of the mortgage to the lender as a deposit. More is the deposit, more is the amount tendered as the mortgage. Before the mortgage process is initiated, the amount to be rendered as deposit must be arranged. Those who are unable to arrange deposits can take a 100% mortgage, where no deposit is required.

The borrower will have to fill up an application form for getting the mortgages. They can either fill the form online or make a personal visit to the lender. Some lenders offer discounts for borrowers applying online.

A copy of the credit report from the main credit reference agencies, namely Experian and Equifax must be kept in handy. If there are any discrepancies in the credit report then they must be immediately sorted out.

The property is valued to decide the amount of mortgage that the mortgagor qualifies for. The cost of the surveys and valuation are to be borne by the mortgagor himself. The borrower can request for a revaluation in case he feels the valuation has been incorrect.

The pillar on which the mortgage is going to stand is constructed in this stage. Various details of the mortgage like the manner of repayment and the interest to be charged are to be decided.

One wrong step in the mortgages and you could lose your home to the mortgage lender. Though it is difficult to foresee the future, one can at least provide well for the future. Making well informed decisions can help cordon off the ill effects of mortgages.