Talk Money: Property prices rise

Claire Cook from independent mortgage and financial advisers Talk Money, gives essential advice

House prices rose for the ninth consecutive month in November according to the Nationwide house price index. The average house price now stands at £162,674 which is a similar level to early 2006.

The figures show that prices are rising more moderately than the spring and summer of this year, but prices are still rising. This seems to be giving a feel-good factor to the housing market. Many purchasers are now fi nding themselves in competition for the best properties.

With this in mind, if you want to buy it is wise to put yourself in the best possible position. So, put your mind at rest and also to encourage vendors to accept your offer, it may be wise to obtain a decision in principle from a lender prior to starting to look. The fi rst step is to run your fi nancial situation by an independent adviser. They will have knowledge of the current mortgage market, and will be able to tell you straightaway if you are in a position to obtain a mortgage.

It is very important to make these initial enquiries, as lenders have tightened up considerably on their lending practices. Independent advice is essential, the mortgage market has contracted and an independent adviser will be able to give you the best possible choice oflenders and rates.

Assuming your general situation is acceptable in the advisers opinion, they will then provide you with some rate options. Once the best rate has been identifi ed they can get an agreement in principle arranged for you. This means putting your details online to the lender, the lender will do a credit check and will apply their lending policy to your own situation. The agreement normally comes back immediately, and the adviser can print off confirmation for you. This means that you can look for property with confi dence, knowing that you have a mortgage pre-agreed.

If you already have a mortgage and it is portable, it is essential that you carry out the above checks. A portable mortgage does not mean that you can take the
mortgage anywhere without your lender reassessing your situation.

It means that the lender, assuming you still fi t their criteria when you wish to move, will simply allow you to take your current rate with you.

This avoids you paying any early repayment charges. The lender will always reassess your financial situation at time of moving.

Even if you are paying your lenders standard variable rate, often it may be worth porting your mortgage across. Did you know that lenders no longer offer their standard variable rates to new borrowers? This is because the rates are often so competitive, even if your initial rate has ended, it is often very beneficial to port the rate across to your new property.

Again, seek the advice of an independent adviser who can compare this option to other rates currently available. They are able to direct you back to your own lender if this is the best option for you.

If you need financial advice concerning mortgages or any other financial matter, please call Claire Cook on 01273 224667. I would be very happy to assist.
Buy to let mortgages are not regulated by the Finanicial Services Authority.