Mortgage promise or Agreement in principle.
When applying for a mortgage you will find that it breaks down into three main sections:-
- Credit check/score for each applicant.
- The full mortgage application.
- To pay for a surveyor to produce a valuation for the property.
Of course you are unable to obtain a survey before finding a property that interests you, however, the mortgage promise should be carried out in advance. Obtaining a mortgage promise is highly recommended as it comes with many benefits. Firstly, it will ease any worries that you may have as to whether a company will lend to you. It will give the vendor the same assurance when you do find. Should anybody else forward an offer on the same property that has not researched their mortgage yet, they will not be seen as favourably as you.
These promises may be obtained quite easily and for free. If you wish to receive one, simply contact us with brief details, such as:-
- Full names,
- Current addresses,
- Dates of birth,
- Occupation & salary,
- Prospective purchase price & loan required
We will usually have an answer for you within twenty-four hours. Alternatively, you may e-mail us those details or e-mail your name and number and best time to contact and we will call you to save your telephone bill. A form can be found on contact us.
Survey
To receive your mortgage offer, you will have been credit checked. The lender will have assessed your application form and checked for proof of identity and income.
The one thing remaining to check is the suitability of the property itself. The only way to carry out this is to have a report raised. It is usually the case that you, the lender, the broker and your solicitor will all receive copies.
It stands to reason that because this is a fundamental task, it needs to be done upon submitting the full application. It is only on receipt of this satisfactory report, along with those mentioned above, that you can hope to receive your formal offer.
Costs
Solicitors usually charge ITRO £1000 for all labour, VAT and disbursements (double this if you buying and selling though). You will need to add Stamp Duty to this bill. 1% of the full purchase price of the property from £125001-£250000. 3%= £250001-£500000 and 4%= £500000+.
Your survey can vary depending on lender, value of the property and the type you require. A rough guide would be around £500.
Other fees to be factored into the equation are Estate agents fees, mortgage product fees and the one that always gets forgotten….The removal firm costs.
Your home may be repossessed if you do not keep up repayments on a mortgage or other loans secured on it.
Think carefully before securing other debts against your home.
Buy to let (pure) and commercial mortgages are not regulated by the FSA.
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