Recommending the right deal for the right borrower

In order to become an accredited mortgage advisor, you must first undertake the appropriate CeMAP training to provide quality advice. The training covers in detail everything from the laws and history of mortgage practice, to the current legislation that must be adhered to and various types of mortgage, and associated protection products, that are available.

When you have passed the end exam, you will be able to meet with customers and support and guide them on their house-buying journey. The main part of the interview process is about getting to know your customer, and by establishing what type of borrower they are, you will take the first step in recommending the most suitable mortgage package.

Here are some buyer types for consideration:

Sole purchasers

The biggest fear for a sole purchaser is their sole responsibility for the mortgage repayments and other utility outgoings. The stress of increasing rates cannot be shared with another party, which may mean the borrower leans towards favouring a fixed rate mortgage. This will allow the borrower to budget for a set period of time, and provide security. As a sole purchaser, it is often important to keep the initial costs as low as possible, so a fee free package can seem more attractive. Income protection insurance – which means that the borrower can maintain their mortgage payments in the event of accident, sickness and unemployment – is another important area for a sole purchaser.

Young families

As with the sole purchaser, fixed rates often appeal to those borrowers in long-term relationships and with youngsters, as budgets can be tight, and they enable the homeowner to budget more effectively.

Big earners, big borrowers

The affordability calculation will determine how much can be borrowed. General rule of thumb (subject to a full income and expenditure analysis) is that a greater income can afford you a larger mortgage and therefore a larger house. It is still vital to factor in the borrower’s attitude to monthly payments, and the flexibility they want. Do they like to know what is going out every month? Are they leaning towards a fixed rate, or are they looking to be able to make additional lump sum payments during the term, making a variable rate more attractive?

Double income no kids yet (DINKYs)

Those who fall into this borrower category will usually have a strong amount of disposable income, with minimal outgoings, giving them maximum freedom when it comes to deciding on which mortgage product they feel is best for their needs.

There are various borrower types, as there are various mortgage products. Ultimately, whilst it could be said that young families will always choose a fixed rate for the security of knowing what their repayments will be, this will not always be the case.

As a mortgage professional, it is your job to get to know your customers, and establish their needs after finding out about their individual circumstances by explaining the various mortgage products available, and gauging their thoughts towards them. Once qualified, you will be able to offer an honest and transparent advice service by providing their perfect mortgage solution.



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