Please note that we do not offer advice on mortgage loans, however we can help you to ensure that any loan is suitably protected.
1st Time Buyer - Buying your first home may be the largest financial transaction you will make. There are some advantages of being a first time buyer - interest rates are currently very low and first time buyers are more appealing to sellers because they are not in a chain.
Buy to let – Buy to let is no longer what it used to be, with many investors who bought previously have struggled as mortgage rates have increased. It should be noted that the value of a property is generally a matter of opinion and may not be recognised until it is sold. Borrowers will still be responsible for making the mortgage payments in the event of the property not being rented out; therefore there should be suitable plans in place for this. The Financial Conduct Authority does not regulate some forms of buy-to-let mortgages.
Endowment – Two payments will be made per month, one to the lender to repay the interest on the amount borrowed, and the other to an insurance company for the endowment contract. The capital in the endowment aims to build up over the term of the mortgage to repay the outstanding capital. However, to achieve this the investment performance must be enough to build up the required capital and this cannot be guaranteed.
Interest Only – Monthly payments will pay the interest to the lender, and do not include the repayment of the capital. The total loan amount will need to be then paid back at the end of the mortgage term. It is therefore important to arrange additional investments which will generate enough capital to pay back the loan.
Remortgaging – This is the process of switching your existing mortgage to another lender, generally to make your payments lower. You are not obliged to stick with your original lender for the full mortgage term. Although early repayment charges may apply to the existing lender, remortgaging could still save you thousands of pounds over the term of the mortgage.
Repayment – You borrow a lump sum over a fixed period of time (usually 25 years). You pay the interest and some of the capital on a monthly basis to the lender. An advantage with this is there can be flexibility with the repayments, such as making over payments, or under some circumstances making underpayments, or even borrowing back previous overpayments. However, in the early years only a small amount of the capital is paid off as the mortgage payments will consist of a higher proportion of interest to capital repayments.