The mortgage market needn’t be a minefield to navigate

Barely a week goes by when we don’t hear or read a story about the mortgage market. Whether it’s approvals going up or down, new products being brought to the market or the likelihood of the Bank of England imposing an interest rate increase, the mortgage market can sometimes feel like a minefield to navigate – both for first time buyers and seasoned home owners alike.

But worry not. The news always focuses on extreme situations and the reality is a lot more positive than they’d have you believe.

Simply, there has never been more choice in the mortgage market and whilst this can feel daunting, it is something which should be embraced.

If you’re a first-time buyer, the chances are this will be the first time you’ve ever really looked in to the range of mortgages available. Let’s face it, you’ve never needed to before! However, given this is going to be your biggest financial decision to date, make sure you do your homework and don’t simply opt for what your bank offers.

It’s understandable that this may feel like the safe or easy option, and if you’ve found your dream home it’s easy to plump for what feels like the most accessible mortgage. You’d be well advised to shop around though as the market has never before offered such choice and there really is a plethora of alternative deals and rates available.

Indeed, that goes for borrowers in most cases – not just those setting out on the property ladder for the first time. Rates offered to re-mortgagers and home movers similarly remain very competitive.

We’re often asked if opting for a fixed rate mortgage is the best option when taking out a new mortgage and in many cases, it is. Simply, knowing what the costs will be over a specific period of time is an attractive option for many. Such is the range of options available, however, it shouldn’t be your only consideration. One size doesn’t, after all, fit all.

Similarly, remember that if something looks too good to be true, the chances are it will be! Whether working direct with a lender or through a broker, ensure that you make clear exactly what your requirements are and any aspects of your situation which you foresee changing in the future. Lenders have a duty of care to make decisions based not only on your ability to afford the mortgage today, but in the future too.

And this is an important point to bear in mind when we consider one of the media’s favourite mortgage-related topics – interest rate rises! The Bank of England has kept interest rates historically low at 0.25 per cent for some time and speculation is rife as to when this trend will be reversed. Without a crystal ball, it’s impossible to say with any certainty when this may happen and whether it’s later this year, at some point in 2018, or beyond that is anyone’s guess.

What is important to bear in mind is that any, even slight, shift upwards may impact on the range of mortgages available to some borrowers. That means that by fixing now, safe in the knowledge that your ability to continue paying even when rates do increase has been checked, could be a positive course of action to take.

If you find yourself needing to navigate the mortgage market for the first time, you’re considering a re-mortgage or you’re about to move home, your local Andrews team on King Street in Stroud and their colleagues at Andrews Mortgage Services can help. Visit andrewsonline.co.uk/mortgages/