It is all very well, when you're a first-time buyer, to be advised on shopping around for a mortgage. You are told to check out all the options. Don't just take the first mortgage that comes along, your wise advisers will say.
You agree, acknowledging the principle that putting some effort into finding the best deal will always make sense. You do not want to be fooled into paying too much for your home. The problem with this approach is that there will be no point in shopping around unless you are well-briefed on what you should be shopping for. How will you be able to differentiate between a pile of potential mortgages when you don't understand how the concept works?
This all means that the first step to finding the right mortgage for you should be taken before the physical search for a loan begins. In fact, it should begin as soon as your thoughts turn even in a small way to hunting for a home of your own.
Finding information on mortgages has become a lot easier over the past few years, with the arrival of the internet smoothing the path to knowledge.
One very useful resource in this regard is the Irish consumer finance website www.askaboutmoney.com. This site, which is moderated by a number of financial experts, contains a "mortgages and home buying" forum, where even the most naive question will be answered by somebody who has either been in a similar situation or by a professional.
Topics addressed on the site earlier this week varied from getting mortgages on a low salary to converting leasehold into freehold title, with a forum on frequently-asked questions always running. Within this section, first-timers can find information on anything from the difference between fixed and variable loans to switching loans mid-way through the term.
Once you have the basics, you will be ready to move on to queries that will be specific to you. You could do this by approaching a mortgage broker who should be able to explain all aspects of a homeloan in simple terms. Rather than making an appointment with a particular broker, it may make more sense to attend one of the first-time buyer seminars which have begun to spring up around the country over the past year. Irish Mortgage Corporation is a trailblazer in this regard, hosting a few seminars in Dublin every month. Other organisations have been getting in on the act, with the EBS an obvious example.
These events will be useful mostly because they should allow buyers to ask questions without feeling pressurised into taking out a particular product that may be available. First-timers should always remember that it's not necessary to "repay" somebody offering advice by giving them their business.
Once this stage is passed, the house-hunter should have all the information they need to take out the mortgage that suits them. If there are any last-minute terms they do not understand, they can consult online jargon busters such as that offered by Simply Mortgages on www.simplymortgages.ie. And if they want to compare rates, consult the table that accompanies this column. The fairest comparison will come from the "cost per 000" column, which aims to strip out all other variables. Happy shopping!
If readers would like to see any particular topic covered in this column, email umccaffrey@irish-times.ie
