This is how to make sure you get the best mortgage deal

Thursday, 3rd December 2020, 9:25 am
Updated Thursday, 3rd December 2020, 9:26 am

by Derin Clark

Mortgage rates remain competitively low, and those looking to remortgage can currently get a two year fixed rate from just 1.17%. As well as this, many mortgage deals are offering incentives, such as free valuation or no legal fees, and some are not charging any product fees. As a result, now is clearly a good time for many homeowners to lock into a mortgage deal, but while there are some highly competitive deals on the market, not all mortgage borrowers will qualify for the best deals available.

To help you get the best mortgage deal, we’ve highlighted some of the ways that you can improve your chances of being accepted for the best deals around.

Use a mortgage broker

A mortgage broker may add additional fees when getting a mortgage, but in return they will be able to helphighlight the best deals for your individual circumstances and help you to consider the various options available, for example whether you should opt for a fixed deal or one with a variable rate. As well as this, mortgage brokers often have access to deals that are only available through brokers, which can sometimes offer better rates or incentives than those that can be applied for directly.

If you’re still not sure about whether using a mortgage broker is right for you, take a look at the Moneyfacts.co.uk site, which provides extra information about whether using a mortgage broker is the best option.

Consider all types of providers

It can be tempting to just go to your current bank and see if they will offer you a mortgage deal, but this may not be the best option for you – even if they are offering the lowest rate in the market. Instead, borrowers should consider all the deals available, which can be found by looking on whole of market comparison websites, to get an idea of what mortgage options are available and the types of rates being offered.

The mortgage market is changing all the time as lenders constantly withdraw products and introduce new ones, as well as reduce and increase rates, so regularly looking at the mortgage charts will help you to keep up with the changes in the market.

Check your credit score

When reviewing a mortgage application, lenders will run a credit check on the borrower and the higher theircredit score, the more likely they will be offered the deal. This is why it is a good idea to check your credit score, which you can do for free online, before making a mortgage application.

If your credit score is low, it is unlikely you will get a mortgage, or at least not one at a competitive rate. In this case, it might be a good idea to work on improving your credit score before making a mortgage application. Increasing credit scores can be a long process but there is advice online on different ways you can improve your score.

Increase your deposit

Although this could be difficult for many looking to get a mortgage, if you are able to increase your deposit you might find it helps to get a better mortgage deal. For example, many providers will offer a lower rate on mortgages that require a 40% deposit – which would be a 60% loan-to-value (LTV) – than those for a 30% deposit (70% LTV). This is even more significant to those with a lower deposit, as in the current market you will have a lot more choice if you have a 15% deposit (85% LTV) compared to a 10% deposit (90% LTV).

For more information about getting a mortgage, saving for a house deposit or to view all the current mortgage deals available, visit Moneyfacts.co.uk