Buying a home

How much to borrow?
How much you borrow affects what property you can afford. Mortgage companies lend money based on your income. They also take into account your usual outgoings, particularly the big stuff such as loans.

However, it's just as important that you work out how much you can afford to pay every month for a mortgage, as well as all the other bills. You need to consider how you would cope with a rise in interest rates or cost-of-living expenses or a fall in the value of property.

What type of mortgage?
There are many different types of mortgages and providers. There is a lot of unavoidable jargon to understand. The information on Moneymadeclear, from the link below, can help with this.

Shop around
You need to shop around to get the right mortgage for you. There are two main options on shopping around:

• You can do it yourself, by checking with a range of mortgage providers. You will probably find comparison sites helpful: find a link to our mortgage comparison tables below.
• Alternatively, you can get advice from a professional mortgage adviser. Always check that your adviser is authorised by us, using the FSA register; again the link is below.

Or you could do both.

Insurance
When buying a home you need to think about certain insurance products.

• Life insurance: not a cheery subject, but if you die, you still owe the bank the money you have borrowed. If you have any dependants, this could leave them with severe difficulties. Your mortgage provider will probably offer to arrange this insurance, but you can always shop around.
• Buildings and contents insurance. Again, you should shop around to get the best policy for you.
• Mortgage payment protection insurance (MPPI). This is also known as accident, sickness and unemployment cover (ASU). This aims to help you keep up your mortgage repayments if you can't work due to redundancy, accident or illness. You do not have to take this out and, again, you can shop around. If you do decide to take MPPI, it is important to check that it covers your circumstances.