Mortgages

Our mortgage solicitors can advise on all aspects of property finance, whether you are a borrower or a lender.

We understand the bigger picture and provide an efficient service to guide you through the mortgage process. Call us today.

You may require additional financial assistance when purchasing a property. A mortgage is a loan for a fixed number of years with a mortgage lender, which is secured against the property you purchase.

The 7 types of mortgages

• Fixed rate mortgages
• Variable rate mortgages
• Standard variable rate mortgages
• Discount mortgages
• Tracker mortgages
• Capped rate mortgages
• Offset mortgages

You should not enter into a mortgage unless you are sure you can repay the monthly payments for the duration of the mortgage term. Most mortgages are repayment mortgages with added interest, some are interest-only mortgages. If your mortgage is interest only, you will still need to repay the whole mortgage capital at the end of the repayment term and you should ensure you are able to do this.

By taking out the mortgage, you agree to repay the money under the terms of the mortgage for the duration of the mortgage term. If you fail to make your mortgage repayments, your property can be repossessed by the mortgage lender and sold in order for them to get their money back.

You should, ideally, obtain a mortgage agreement in principle (AIP) prior to looking for a property to purchase to ensure that you are eligible for mortgage finance. This will also put you in a better position when negotiating the purchase of a property.

Obtaining a mortgage agreement in principle

Once you have looked into the current mortgage rates, either through your mortgage broker, online or directly with your Bank, you’ll have chosen your mortgage lender and mortgage product, and are now ready to contact your solicitor to instruct them to deal with your mortgage alongside your property purchase.

Your solicitor will send you their initial documentation and terms of business, including a questionnaire to complete and return. This will provide information regarding yourself and the property you are buying, along with details of the new mortgage you are looking to take out. Your identity will need to be verified with your solicitor, even if your mortgage broker and mortgage lender have already been sent this.

Your mortgage lender will need to carry out a valuation of your property in order to protect their interest and ensure the property provides them with adequate security.
This will be arranged prior to the issue of your mortgage offer and a valuation fee is commonly charged to you by the mortgage lender, which is payable to them directly. The valuation is for the lender’s own purposes and you cannot rely on this. We recommend that you arrange your own independent survey of the property.

Once your mortgage offer is issued, a copy should be sent directly to your solicitor by your lender. You should check that your solicitor has received a copy of the mortgage offer in order for them to proceed with the mortgage work. The solicitor will then need to arrange to carry out searches and enquiries to ensure that they comply with the mortgage instructions received from the individual mortgage lender. Your solicitor will be acting for your lender, in addition to yourself.

When the mortgage offer has been checked by your solicitor, they will send you a letter reporting on the terms of the new mortgage along with the mortgage deed to be signed by you in the presence of an independent witness. The signed and witnessed mortgage deed should then be returned to your solicitor.

The terms of the new mortgage offer will outline the conditions on which the mortgage is offered to you. This will include details of the monthly payment, interest rate, repayment term, any redemption penalty and further terms and special conditions which you must strictly adhere to throughout the mortgage term.

Your solicitor will need to review the legal title of the property and check whether there have been any alterations or additions to the property to ensure these are satisfactory and comply with statutory regulations and your new mortgage lender’s requirements.

Once your solicitor is in a position to arrange completion of your purchase/new mortgage, they will request the mortgage advance from the new mortgage lender.

Following completion of your purchase and mortgage, the new mortgage lender’s interest will be registered against your property’s legal title at the land registry. The mortgage will not be removed from the legal title until you have paid off the mortgage.

The mortgage lender will write to you directly after completion to confirm the new mortgage payment arrangements.

If you require any guidance, advice or direction with any legal questions regarding mortgages and purchasing property, please contact the team who will be happy to help.