Questions to Ask
What to ask before you start your new homes journey
Questions to ask before applying for a mortgage
Securing a mortgage can be one of the biggest financial commitments in a person’s life. New Homes Mortgage Helpline, the UK’s leading new homes mortgage specialist, can assist you in this journey.
Here are some crucial questions to consider as you venture into the home-buying process, assisting you in determining your readiness for a mortgage application.
How much do I need for a deposit?
The larger the deposit you’re able to provide, the more choice of lenders are available and the lower the mortgage interest rate could be. However, mortgages are widely available with only a 5% deposit, and in some circumstances, no deposit is required.
Don’t forget to factor in additional mortgage setup fees, such as Stamp Duty and solicitors’ fees.
Regular savings can boost your eligibility for a loan. Check out our deposit guide for more insights.
What is my affordable monthly repayment?
Our Mortgage Advisers will run through a comprehensive budget planner to understand your monthly income, and your committed outgoings.
Our budget planner is tailored to you, and considers your own specific needs and preferences over the short, medium and long term.
Your monthly repayment can also be impacted by your chosen term. A longer term may reduce the monthly repayment, but it will take longer to pay off.
Do I qualify for any government schemes?
Government schemes could be a starting point if you’re struggling to afford a mortgage.
There are a range of schemes available depending on your circumstances and where you live. They are generally aimed at first time buyers, but can also include home-movers in certain circumstances.
Typically they fall into the following categories:
- Shared Ownership
- Shared Equity
- Reduced Market Value
How much can I
borrow?
How much you can borrow depends on your circumstances, including your:
- Income
- Committed monthly outgoings
- Credit score
- Age
- Number of dependants
Typically lenders may lend up to 5x your income.
Is a mortgage guarantor an option for me?
If you’re financially stretched, a guarantor (usually a parent) can support your mortgage application.
While you remain responsible for the repayments, your guarantor would step in if you defaulted.
Guarantors should seek independent legal advice to understand their obligations. Few lenders accept guarantor-backed applications, so do your research on guarantor mortgages.
Should I opt for fixed monthly payments or a variable interest rate?
Your choice between a fixed-rate mortgage and a mortgage with a variable interest rate (tracker/discount) depends on your financial situation.
Popular fixed-rate mortgages can provide certainty about your monthly payments for the initial term, offering budget stability. Alternatively, if you can manage potential rate increases, opting for a variable interest rate could mean benefiting from potential rate reductions.
