Buying a home is a significant milestone, and finding the right mortgage is one of the most critical aspects of the process. In Ireland, where the property market is as dynamic as ever, working with a seasoned mortgage broker can make all the difference. This ultimate guide aims to demystify the process and highlight the benefits of having a seasoned mortgage advisor by your side.
Understanding the Role of a Mortgage Broker
• What is a Mortgage Broker?
A mortgage broker works for you the customer. They do not work for any lenders. This is a key mistake too many people make when think about what a mortgage broker actually is. If you go to AIB or Bank of Ireland directly they will only tell you what the best rate in Bank of Ireland is. If you could save €50,000 by walking across the road to AIB they will not tell you! With a mortgage broker they have access to multiple lenders so they can compare the full range of offer for you. This will save you a massive amount of money.
• The Benefits of Using a Broker:
Brokers can access all lenders, they are experienced in dealing with the application process so will explain to you in plain English what all documents are, why the Banks need them and how best to position an application. They also have modern digital systems that allow you to upload documents 24/7.
• Mortgage Broker vs. Direct Lending:
With a Bank they only ever sell you their products. You will most likely have to deal with junior and inexperienced staff that are very, very difficult to get hold of when you need them . It takes ages and getting updates and explanations is like pulling teeth. If a better rate becomes available at another Bank they will not tell you. With a Mortgage Broker you don’t have any of these problems. You get a single point of contact, a 24/7 digital system and your mortgage broker is always available on the phone. Also – with the right mortgage broker like Pangea Mortgages you get highly experienced staff who really know their stuff.
How to Find the Best Mortgage Advisor
• Research and Reviews:
You need to ensure you get the best mortgage broker. It doesn’t matter where the broker is based in Ireland as the rules are the same for mortgages in Cork as they are in Donegal. They key is the quality of the company. Check Google reviews and see what past customers have said about them. There should be a min of 4.5 as a rating. Best mortgage brokers will have this.
• Credentials and Experience:
Mortgage Brokers are regulated by the Central Bank so this is the minimum you should get. All brokers also need to have the QFA or qualified financial advisor certificate. This is also the basic level. In order to get the best mortgage advisor you need much more. They will be advising on interest rates – so are they qualified in Economics ? This is critically important to understanding what drives interest rates and what they are likely to do in the future. Do they have any other professional qualifications like accountancy ? or Finance Degrees ? You need to make sure your mortgage broker has more than the bare minimum QFA to really get the best.
• Personal Recommendations:
Another great way to see which mortgage advisors are best is to get recommendations. Check who has worked with them before – check the detailed comments on Google to see what customers say about them. Is there any specific broker in the company they name as being especially good. It always pays to do your research.
Working with a Mortgage Advisor: A Step-by-Step Approach
• Initial Consultation:
Here the Mortgage Advisor or Mortgage broker will walk you through the high level of how the process works. How we calculate max borrowing, all Banks criteria and documents needed.
• Documentation and Pre-approval:
You will need to provide ALL financial documents in your name. This is current account, revolut , investment accounts, loans, credit cards. It is a lot but there is no way around this. Too many people waste time by only putting up 90% of what’s required. Unfortunately, no bank will entertain you unless they get 100% of what they need. So be prepared to dig out all the docs. This does take time.
• Finding the Right Mortgage Product:
The mortgage broker can show you a list of all mortgage options that are available to you. The can walk you through what your monthly repayments will be , if there are any cash back options, how long to fix for and all features of the mortgages.
The Mortgage Application Process Simplified (Approx. 300 words):
• Preparing Your Application:
Gather all the documents !!! This is key ! Order the bank statements now.
• Understanding the Criteria:
Banks lend first time buyers 4x their annual income and 3.5x their income for second time buyers. You also need a 10% deposit. Ask a mortgage broker about first time buyers grants . You also need to show that you can meet the new monthly mortgage repayments, this is usually done by adding your savings and rent (or existing mortgage).
• Submitting the Application:
The mortgage broker will then submit the application to the bank for you, the mortgage broker will deal with any follow up questions the Bank have. They then contact you with updates and how long the process will take to complete.
Common Questions Answered by Mortgage Advisors
• Fixed vs. Variable Rates:
Which is best for you …. That depends. Fixed gives you certainty, if you worry about rates increasing and if that would have a material impact on your finances then fix. If you think rate will drop and you can afford to take the risk then variable could work. It depends on your personal circumstance.
• Fees and Hidden Costs:
Most people forget about the hidden costs of buying a house – stamp duty is 1% of the house price and you will need a solicitor you costs about €3,000 (get a good one- do not go cheap). You will also need a survey – about €500 and a valuation about €185.
A good mortgage advisor can save you a massive amount of money and stress. Its that simple. Get the best mortgage advisor that’s put there – like Pangea Mortgages. It will make a major impact dealing with people that know what they are talking about. Contact us now to learn how we help and why we are experts in the field.