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This enables the lender to have an interest in your property at all time. Therefore, should you be unable to meet the repayments or simply stop re-paying the loan, the lender is entitled to re-possess your property in order for any outstanding loan to be repaid to them.
There are so many lenders now that competition on the mortgage market is very high. Therefore, it is wise to compare each lenders various products that they have on offer. Mortgage lenders can range from the traditional high street banks to specialised loan companies that have been set up on the internet.
When approaching a mortgage lender, it is often best to first investigate their mortgage products and what they can offer you in way of their services. Many lenders now have the capability to offer free legal and valuation services when you agree to sign up with their particular mortgage product. Mortgage lending is a specialised service and many lenders have dedicated mortgage teams that will be able to offer you advice. They also have phone teams that are always ready to offer you a customer focused helpline.
All lenders tackle applications in the same way, they have to assess your suitability to the relevant mortgage that you have applied for. This is why all mortgage lenders and financial institutions are regulated by the Financial Services Authority (FSA). This enables the lender to offer a financial service that is independent and professional at all times. This gives you the peace of mind that you will always receive impartial and expert advice when it comes to the mortgage lending process.
Mortgage lending is big business, however, these days it is very difficult to get onto the property ladder as property has become so expensive. When you are thinking about buying a property, you might assume that a lender will only lend you on average three times your annual income. However, this has changed slightly and in order for mortgage lending to take place, lenders have had to tailor their products to mark these changes and can therefore sometimes offer you up to five times your annual salary.
When approving a mortgage, lenders will have to check your financial status and history. This is to enable them to check that you are financially suitable to the relevant mortgage product and that you have the ability to repay the loan. You will have to provide financial information such as yearly income, monthly expenditure and employment status. These details will all be checked to give the lender a guide as to what amount of loan you can afford and whether you have a clear credit history. If you know that you have a poor credit history then you shouldn’t panic as many mortgage lenders have been set up to specifically deal with applications from people with a poor credit history. Although, the interest rates will be higher due to the risk involved in this type of lending, the lenders are willing to arrange mortgages for you in this scenario.
As mortgage lenders are competing for your business, interest rates on mortgages can sometimes be very low. Lenders’ interest rates are calculated on the Bank of England base rate and have remained low for quite some time. Although, if you choose to purchase a fixed rate mortgage product, the rates tend to be slightly higher that the variable rate or tracker rate options.
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