A mortgage is an important financial product to get right, as you want to make sure that you’re getting the right deal for your money. Before embarking on your search for the best mortgage deal for your circumstances, you should make sure that you have considered the following regarding the type of mortgage you want:

• Do you want to take out a repayment or interest-only mortgage?
• Do you want a fixed rate mortgage or a variable rate mortgage?

These questions are very important, as they will affect the way you pay off your mortgage. If you opt for an interest-only rather than a repayment mortgage, you’ll need to make sure that you have a plan in place to pay off the actual mortgage, as you’ll only be paying off the interest on a monthly basis. You’ll need to put aside some money in a separate fund to pay off the entirety of the mortgage when the term comes to an end, as the mortgage provider will expect this sum in full. This is why, for many borrowers, a repayment mortgage is often the best option. You should also decide whether you want a fixed or variable rate. A fixed rate will determine the amounts you pay for a fixed amount of time, while variable rates will fluctuate and go up or down in line with the base rate of the Bank of England.

Finally, there’s a lot of fees to consider, including stamp duty, legal fees, survey costs, mortgage fees and so on.

Are you looking for advice on mortgages and the right type of mortgage deal for your circumstances? Financial Advisor UK offers a national network of fully FCA-registered and approved financial professionals and mortgage brokers who can help you find the best deals available.

Here’s what you can also be doing to secure the best mortgage deal…

Put down the largest deposit possible

You should put down the largest deposit that you can scrape together when taking out a mortgage, as this will place you in a better loan to value (LTV) ratio, which a lender will look favourably upon. If you are close to the next LTV band, try and push to put down more in your deposit so that you reach it. Mortgage rates really start to drop when you put down more as a deposit. You’ll also get a better deal on interest rates. Try to put down at least 20% as a deposit if you can. Although some lenders will let you put down 10%, you won’t be able to get the best rates if you compare them with those you’d receive in putting down 20%.

Check your credit score

You may not realise, but your credit score is a measure of how good a deal you can get on your mortgage. A lender will use your credit score to assess the level of risk you pose to them in borrowing money. If you have a lower credit score, a lender may make the assumption that you could be unreliable and miss regular mortgage payments. A lender might therefore charge you higher interest rates to cover this element of risk. If you have a higher credit score, you’ll be seen as being more likely to pay your repayments on time, without missing them. This puts a lender at ease that you are a reliable borrower. As a result, they are likely to offer you better rates.

In order to improve your credit score, you can request a credit report from various credit score checking websites online. You should also register to vote, as this helps lenders to verify who you are. Finally, avoid racking up large credit card bills, missing payments on loans and so on, as this will all help you to improve your credit score.

Do your research

The best way to get the right mortgage deal is to shop around. Ask high street banks and lenders for more information on their mortgage deals. If you’re already with a bank or building society in terms of your bank account, the same company may offer you a better deal on a mortgage if you are already a customer. There are lots of lenders to choose from, and the amount of choice can be overwhelming. Comparison websites can help, as can enlisting the help of an independent mortgage advisor, who can compare the market for you.

At Financial Advisor UK, we can help you find the right independent mortgage advisor who can search the whole of the market for you, taking the hassle out of finding the best mortgage deal. You can be instantly matched with a suitable advisor in seconds using our quick and easy matching service.

A mortgage advisor will also be able to help advise you on the right type of mortgage for your circumstances, such as if you are a first-time buyer. An advisor will also know certain lenders very well, including exactly what they ask for in terms of criteria. They can help make the process of applying for a mortgage much smoother and easier, and support your case with the lender.

Keep an eye out for fees

Watch out for fees when trying to get the best deal on a mortgage. Check the small print carefully. Interest rates will greatly impact on the overall amount that you pay back to a lender. You need to check other fees that mortgages come with (in exchange for a low interest rate), as sometimes the fees can push up the cost, to the point where it outweighs the benefits of agreeing to a low-interest rate in the first place.

Closely check arrangement fees that the lender charges to set up your mortgage. Generally speaking, mortgages that have low-interest rates have high arrangement fees of £2,000 or more. If you have a large mortgage, it is worth paying a higher arrangement fee in order to receive a lower interest rate overall. If however you have a lower mortgage, a higher interest rate may be preferable in return for lower arrangement fee costs.

Overpayment fees are also worth consideration. Overpaying on your mortgage is a great way to reduce the overall amount you owe. Many lenders will let you make an overpayment of up to 10% each year if you are on a fixed rate mortgage. If you’re on a variable rate, it is likely that you will be able to make as many overpayments as you wish, without being charged for them. Some mortgage lenders charge high overpayment fees to dissuade borrowers from overpaying. These fees can be thousands of pounds, so read the terms and conditions carefully.