It’s great when you’ve identified your dream property, saved up enough for a deposit and are ready to start looking for a mortgage provider. However, it’s wise to do your research and make sure you know what to look out for when choosing a provider. Here are some tips to help you negotiate a better rate on your mortgage:
Save so you are able to put down a bigger deposit
If you can put down a bigger deposit, you will be more attractive to lenders, who will be able to offer you better rates. You will find that there is a difference in rates between a 10% deposit and a 15% deposit – or if you can put down more you’re likely to get even better rates – and in the long run you will save money on the costs.
Make sure you have a good credit history
A lot of lenders will look at credit history for up to six years, so it’s best to make sure that you have a perfect credit rating – even one late payment on a credit card can affect your rating. If there is nothing adverse in your history, you will be able to negotiate better rates, as you will have proved that you are a safe borrower. There are other things that can help your credit rating too, such as being on the electoral register and keeping bank accounts in credit. There are websites that allow you to check your credit history.
Shop around and look beyond the high street
You may be able to negotiate a better rate with a smaller provider, rather than using a big, well-known high street lender. This isn’t always the case, but it certainly pays to look around, and there are websites you can use to compare mortgage rates. You’ll be able to get a better rate by looking around than just accepting the first offer your bank gives you.
Lenders often change their advertised rates with little or no notice, so if you see a good deal, take advantage of it quickly.
It can really help if you use a broker to secure the best deal on your mortgage. Independent brokers will be able to advise on different lenders, although it is worth noting that some deals will only be available directly from the lender. However, it is worth getting independent advice, which you can then compare with lenders’ own deals.