A mortgage adviser, also known as a mortgage broker, is a professional who provides advice and recommends mortgage products based on your personal and financial circumstances. They act as the liaison between the lenders (banks and building societies) and the borrower (you). They act in the interests of the borrower and not the lender while offering the widest possible consumer protection. Using one can be beneficial because they:

• Have access to a wide range of mortgage products, including some that aren’t available directly to the public.
• Can provide bespoke advice tailored to your situation.
• Can help navigate the application process, potentially making it smoother and quicker.
• Might save you time and money by finding the best mortgage deal for your circumstances.

While comparison sites may be useful for conducting some initial self-research, they aren’t nearly as sophisticated as the specialist mortgage search tools designed and used by mortgage advisers.

Mortgage advisers have access to exclusive deals that are not generally available to the public directly. Unlike arranging your car insurance, finding the right mortgage deal requires thorough expertise and detailed knowledge of the financial markets and of each lender’s specific underwriting criteria. Small differences in rates can result in huge differences in repayments, so there are substantial consequences if you get even a small detail wrong.

Above all else is the personal service that local mortgage advisers offer. There is a lot of complex paperwork involved in the mortgage process that they will expertly complete for you. This is something that cannot be done through a comparison site.

Mortgage advisers are typically paid in one or both of the following ways:

A fee paid by you, the borrower. This can be a fixed amount or a percentage of the mortgage amount.

A commission or procuration fee from the lender once the mortgage completes. This doesn’t come directly out of your pocket, but it’s worth noting that all costs are usually built into the overall pricing of mortgage products.

It is important to check which method your chosen mortgage adviser uses before you enter into detailed discussions.

While the exact requirements can vary by lender, commonly required documents include:

• Proof of identity (passport, driving licence).
• Proof of current address (utility bills, council tax bill).
• Proof of income (last three months’ payslips, recent P60, or two years’ accounts if self-employed).
• Proof of outgoings (bank statements, credit card bills).
• Information about the property being purchased.

Lots!

There are various types of mortgages available, each designed to suit different needs and financial situations. Here’s an overview of the most common types available in the UK:

Standard Variable Rate (SVR) Mortgages: These are linked to the lender’s standard variable rate, which can go up or down. This means that monthly payments may change over time, even if the Bank of England’s base rate remains the same.

Fixed-Rate Mortgages: With this type of mortgage, the interest rate remains constant for a set period, typically between two to ten years. This offers borrowers security in knowing exactly how much they will need to pay each month during the fixed period.

Tracker Mortgages: These are variable-rate mortgages, but the interest rate tracks another interest rate (commonly the Bank of England’s base rate) at a set margin above or below it. For instance, if the base rate is 1%, and the tracker rate is the base rate plus 1.5%, you’d pay 2.5%.

Discount Mortgages: These are a type of variable-rate mortgage where the interest rate is set at a discount below the lender’s SVR for a certain period. For instance, if the SVR is 5% and the discount is 1%, then you’d pay 4%.

Capped Rate Mortgages: These are like variable rate mortgages, but the interest rate will not exceed a certain level, known as the ‘cap’.

Interest-Only Mortgages: With this type of mortgage, you only pay the interest each month, and the capital balance remains unchanged. At the end of the mortgage term, the capital amount borrowed needs to be repaid in full. This can be done by saving separately, selling the property, or switching to a repayment mortgage.

Repayment Mortgages: This is the most common type where you pay back both the capital (the amount borrowed) and the interest each month. By the end of the term, you would have repaid the entire loan.

Flexible Mortgages: These allow more flexibility than traditional mortgages. You can overpay, underpay, or even take a payment holiday, depending on the agreement with the lender.

Buy-to-Let Mortgages: Specifically designed for those who want to buy a property to rent out. The amount you can borrow is typically based on the potential rental income rather than personal income.

Joint Mortgages:

This type of mortgage involves two or more people taking out a mortgage together. It’s commonly used by couples or friends buying a property together.

Remember that the best type of mortgage for you will depend on your personal and financial circumstances. Always consult with your mortgage adviser to understand which type suits your needs.