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A mortgage broker is a professional who liaises with mortgage lenders to ensure that you get a mortgage that is suited to your situation and needs. The broker, in essence, should have an overview of the sector, the skills to shepherd you through the assessment process and the experience to deliver the right deal to the right person.

How is an assessment made and what is it based on?

Before 2014, the determination of affordability (the metric that was used to judge how much of a mortgage an individual could receive) was relatively simple. The amount was calculated at between three and five times an individual’s salary.

In 2014, the Financial Services Authority (now called Financial Conduct Authority), published the Mortgage Market Review, a document that meant that would-be borrowers were required to give more detail about their spending when they apply for a home loan.

In essence it was intended for lenders to ensure that people can still afford repayments if interest rates rise, so the amount an individual could borrow would be based on how much they had remaining after regular expenditure, rather than simply based on their income.

So what are the areas of your financial life on which you might be asked questions?

  • Outstanding loans you might have
  • Credit Card debts
  • Child support maintenance
  • Travel expenses
  • School fees
  • Bills: utilities, phone bills, insurance, council tax etc.

To make this assessment, a lender will usually ask for the following:

  • Latest three months’ payslips.
  • Your P60 form
  • For those who are self-employed, a statement of two to three years’ accounts from an accountant or latest two or three years’ tax calculations & tax year overviews.
  • Three to six months’ worth of bank statements.
  • Utility bills and evidence of other expenses, such as loans.
  • Proof of your identity & address (includes amongst other documents, a current signed UK/EU passport, an HMRC tax notification, a current UK/EU driving licence with photo)

What you gain by going to a broker.

A mortgage broker is essentially an advisor specialising in making sure you get the most suitable deal for your circumstance. As we’ve made clear above, affordability assessments are now more complicated and onerous than they were before 2014, so with the right broker, you will find that you can save time, stress and, possibly, money.

Going to a broker rather than going it alone can have a variety of benefits:

  • A broker’s advice will be tailored to your individual needs
  • A broker will look across the whole market for the deal that is most suitable for you.
  • A broker can save you time and money by taking care of the research, assessment and administration of the deal on your behalf.
  • A broker should have an in-depth knowledge of the market and the range of options available to you.

What Exe Mortgages can do for you.

Choosing the right mortgage broker can be a minefield. They come in many forms from tied or multi-tied brokers with connections with one or a limited number of lenders, to whole of market brokers who will explore the whole market to find your deal.

As a whole of market broker, Exe Mortgages Ltd will work with you and your ideas rather than for the mortgage lenders. We apply a holistic approach when researching your individual requirements, and we take pride in our knowledge of lenders exact criteria. With this knowledge we can help guide you through the current mortgage maze.

Get in touch today for more about how we can help you find the right mortgage to suit your needs.