An Independent Mortgage Brokers Guide to Mortgages

With all these options available the good news is that you can find the correct mortgage for you. However this improved choice can seem bewildering and you may miss out on the best option for you through confusion, lack of time or simply having too many choices.In this competitive market it has never been more important to get clear, concise and simple independent advice to help you make the right choice.This guide is designed to help explain some of the options available to you and to let you know how a mortgage broker can make sure that one of the most important choices of your life is the correct one for you.
The Mortgage ProcessWhat is a mortgage?
A mortgage is made up of two parts:The Capital -
This is the amount of money that is borrowed from the lender to purchase the property.The Interest -
This is the interest that the lender charges on the capital until it is repaid at the end of the mortgage term.
Types of MortgageRepayment mortgageEach month your payment to the lender repays some capital and some of the interest. As long as you maintain your payments you can be certain that your mortgage will be repaid at the end of the term.Advantages
As long as the monthly payments are maintained the mortgage will be repaid at the end of the term - no need to worry about investment returns
Ideal if you wish to limit the risk linked to your mortgage
Simple to understand with payments to one providerDisadvantages
No possibility of additional investment returns
If you move house frequently it is difficult to build up equity in the property in the early years, as early payments are mainly interest
Limited possibility of repaying the loan early without increasing monthly payments
Interest only mortgageEach month the payment to the lender repays the interest on the loan. In this way the amount that is owed to the lender remains the same throughout the mortgage term. At the end of the mortgage term the lender will require the original amount of the loan to be repaid. A separate savings vehicle is used to build up enough money to repay the loan.Commonly used savings vehicles are:
Endowments (With profits)
PEPs (Pre April 1999)
ISAs (Post April 1999)
PensionsAdvantages
Offers the potential for additional investment return at the end of the term or the ability to repay the loan early, subject to investment return
The savings vehicle is usually portable when you move house
Choice of a wide range of investments that can be tailored to meet individual needs
Easy to move the mortgage without disrupting the repayment planDisadvantages
The ability to repay the loan is dependent upon the investment performance of the savings vehicle
You are responsible for the repayment of the loan at the end of the term
Two separate payments to track. One to the lender and another to the investment company
'Mix & Match'Many people moving house may already have an endowment plan from their previous loan. Their circumstances may have changed, however, so an additional endowment would not be appropriate for them. In these circumstances, it is usually possible to arrange for a lender to set up part of a loan on an interest only basis, and part on a repayment basis, thus ensuring that the benefits already accrued under the endowment are not lost. Not only that, but the life assurance already provided under the endowment is not lost.This method is becoming increasingly popular for people moving on to their next house.
Endowment Mortgages (With Profit)This type of investment combines a savings vehicle with the life protection needed to repay the loan on death during the term.Bonuses are usually, but not guaranteed to be added to the plan on a yearly basis and once paid these cannot be taken away.In this way the endowment aims to provide steady growth over the mortgage term and provide a lump sum, which should allow you to repay the loan although this cannot be guaranteed and is dependent on investment performance.Advantages
Guarantees to repay the loan in the event of death during the term
Portable and can be moved from mortgage to mortgage
Once bonuses are added they cannot be taken away
Potential for additional returns
Potential to repay the mortgage early
Can combine savings plan with life and critical illness protection if requiredDisadvantages
If surrendered early the return may be less than the premiums paid
No flexibility in premium payments
Term should be for at least 15 years
No guarantee that the mortgage will be repaid. The return is based wholly on the investment performance of the chosen provider
Must have life cover built in whether required or not
A Market Value Reduction (MVR) could apply to your endowment (if with profits) in adverse market conditionsA Market Value Reduction is a reduction applied to unitised with-profits funds where the value of the underlying assets is low. The Market Value Reduction, if any, is applied only when the plan is fully or partially surrendered (for example, on early retirement or transfer to another plan) or units switched into another fund.
ISA MortgageAn ISA (Individual Saving Account) is a very flexible way of saving to repay your mortgage. They do not have a set investment term and contributions may be varied (usually subject to maximum and minimum limits). You can pay on a regular monthly basis as well as making lump sum payments into the plan as long as you remain within the maximum annual limit.They offer a wide range of investment choices and also have several tax advantages.Additional protection such as Life or Critical Illness cover is usually purchased separately.Advantages
Tax efficient savings
No specific term
Potential to repay the loan early
Potential for additional investment return
Flexible premium payments
Portable - can be moved with your mortgageDisadvantages
Separate protection plan(s) required
Return is reliant on investment performance
No guarantee of return
Can only be taken in single name
Pension MortgageThis aims to take advantage of the tax free cash that is available from a personal pension plan. As this involves pension planning as well as mortgage planning it can be a very complicated area to consider.As with all the other options highlighted, there are advantages and disadvantages, however due to the complex nature of Pension Mortgages they should be dealt with on an individual basis and independent advice should be sought.

Hanson Wealth Management are a UK based Independent Financial Adviser. Hanson are the only Mortgage Brokers endorsed by the Police Federation of England and Wales to provide Police Mortgage Quotes

The Keys to Finding the Top Mortgage Lenders

Since the invention of the internet, finding top mortgage lenders has proven to be a lot easier. However, it will still take some time and effort on your part to wade through all the information that is provided to you online. By taking your time over this aspect of searching for mortgage lenders then of course there is a greater chance of you finding a loan that meets your requirements and that you can afford.

As you do carry out your search for such lenders, there are certain things you should be focusing on. This includes the rate of interest they charge, how long the loan is for and what are their requirements in relation to you qualifying for their loans. Keeping this information in mind will ensure that you then find exactly what you need.

So where should you be looking for top mortgage lenders? Below we take a look at some of the options to consider.

1. Speak To Your Bank

In many cases this should be your first port of call when it comes to finding the right lenders. By having a working history with them they can better advise exactly, what sort of mortgage, you should be going for and why. Plus even if your credit history isn't absolutely perfect they will understand why and of course are more than willing to help you with getting what you need.

2. Speak To The Real Estate Agent

These people should have their finger on the pulse and so can help any potential customer to achieve their goals. However if you are intending to ask for their assistance when it comes to finding top mortgage lenders ask what they will be paid (commission) for referring you to them. If you don't you may be surprised when they ask for payment for carrying out the search for you.

Looking to Refinance your mortgage?

Visit our site for information on subprime mortgage lenders and find out how they can help you today. By Naomi Smith

Mortgage Life Insurance Rates

Mortgage life insurance leads can be a nice profit generator for any insurance agent. It is often used as a method by which individuals or groups of people can buy health insurance without paying the full value upfront. The mortgage life insurance leads are generated mainly through major search engines like Google, Yahoo or MSN. By putting the mortgage life insurance leads on such search engines, one can raise the most motivated prospects possible.

Mortgage life insurance quotes and rates are provided by all of the various insurance companies. These mortgage life insurance programs have the power to protect one's finances with all of the advantages that these companies can provide. So the mortgage life insurance rates provided by the various companies become a major factor in from among choosing insurance policies. After one adopts and combines the mortgage life insurance coverage, the various insurance companies credit one's mortgage life insurance, usually at a constant rate of ten percent per annum, for the express purpose of insuring one's life in the near and/or distant future. But one should always carfefully consider the advantages and disadvantages of such homeowner's insurance rates. It is not always conducive for all the people to fulfill the financial formalities of these insurance rates.

Sometimes it may happen that people find it difficult to pay premiums at the rates put by the companies. In such cases one should look for mortgage life insurance discounts. These rates are often softened by the insurance companies on certain conditions, like a sudden mishap.

How Much Mortgage Life Insurance Cover to Consider

It is no secret that mortgage lenders strongly encourage their borrowers to take out mortgage life insurance to protect their investment. However, it is also the case that many mortgage holders want to take out life insurance to protect the financial stability of their family. As a result, serious consideration should be taken to decide how much cover to purchase. Outlined below are a number of factors to consider when deciding how much mortgage life insurance is needed.

Total mortgage loan outstanding

A natural place to start when deciding how much cover to purchase is to find out how much is outstanding on the mortgage loan. Although this is not the maximum that can be insured it does provide an initial starting level of cover to consider before either adding or reducing the level of life cover. The amount of loan outstanding is the total potential financial liability faced by the borrower(s) and is therefore a good reference point for an appropriate level of cover.

Company provided insurance

It is sometimes the case that an individuals company may provide them with life cover. The amount of cover provided is usually calculated as a multiple of annual earnings. If this is the case an individual needs to decide whether the amount provided is sufficient to cover both their mortgage loan and provide financial security for their family. If the level of cover is sufficient then there is little point paying premiums each month for a separate mortgage life insurance policy.

Savings and family protection

If an individual has substantial savings then they may not need to take out cover for the full amount of their mortgage loan. In this case, the individual's family could use the payout from the mortgage life insurance to top up their savings and then pay off the loan. However, it is also important to consider the financial position the family will be left in upon death, especially if savings have to be used of pay down mortgage debt. An individual may decide it is better to leave family savings in tact and take out mortgage protection cover instead.

It is not unusual for individuals to take out more life insurance cover than the amount outstanding on their mortgage loan. The reason for this is to provide additional family security upon death. There is no stipulation that the amount of cover taken out cannot exceed the amount outstanding on the mortgage loan. As a result, it is perfectly acceptable to take out additional family cover on top of the mortgage amount, which may be especially appropriate if the family has a low level of savings. Of course, it is also possible to take out one life insurance policy to cover the mortgage and another for family protection.

Thus, before purchasing mortgage life insurance it is important to establish the appropriate level of cover, which may not always simply be equal to the amount outstanding on the mortgage loan. It is also important to consider family savings, family protection and if company life insurance is provided.

This article was produced by James P White of Drewberry Mortgage Protection Cover, specialist providers of information, advice and broking services in the mortgage life insurance and mortgage payment protection insurance markets.

Why Use an Independent Mortgage Adviser

If you are looking to buy a property, or remortgage property you already own, you will have the option of searching for a mortgage product by yourself or employing the services of and independent mortgage adviser.

There are various factors that you should consider when deciding whether or not to utilise the services of mortgage adviser, not the least of which is the sheer size of the modern day mortgage marketplace.

The mortgage market has evolved considerably over the past few decades and there is now a vast array of mortgage products available to finance both your own home and your investment properties.

In fact the mortgage market has grown and evolved so much that there are now hundreds of lenders supplying thousands of mortgage products in the UK alone. You may therefore be wise to seek advice from an independent mortgage adviser before applying for your next mortgage based on this factor alone.

In addition to helping you navigate the complexity of the modern day mortgage market, there are other benefits to using a mortgage adviser.

One of those advantages is that some mortgage advisers have access to exclusive deals that are not available on the open market. These deals are made available through independent brokerages and can appear and disappear quickly.

Exclusive deals can come with benefits such as lower interest rates, reduced application fees, and free legal fees or survey fees. If you choose to source their own mortgages and not employ the services of a mortgage adviser you may miss out on these exclusive deals.

Another advantage to using a mortgage adviser is that it is no longer necessary to have a face-to-face meeting with them before conducting any business. This means that you can choose which mortgage adviser you would like to utilise without any geographical restrictions.

Although a face-to-face meeting is not necessary, you will likely be asked to provide your mortgage adviser with proof of your address and a copy of your identification, such as a passport, before the adviser can submit a mortgage application for you.

While using the services of a mortgage adviser has its benefits, there is usually a cost involved. You should therefore weigh up the cost of utilising a mortgage adviser against the benefits outlined above before deciding whether or not to go it alone when searching for your next mortgage.

Visit UK Mortgage Source to find an independent Mortgage Adviser nea