Compare Mortgages
At any one time there are several thousand mortgage deals available which can make choosing the right deal confusing.
In order to help you navigate your way through the many different types of mortgage deals available we have teamed up with ValuePlace Mortgage Advice Network.
Just click on the link below and complete a simple enquiry form. You will be put in touch with a qualified mortgage advisor who is authorised and regulated by the Financial Service Authority. Your details will only be given to a single mortgage advisor who will contact you direct about your mortgage requirements. No credit checks will be undertaken without your knowledge and your details will not be given to any other third parties.
The mortgage advisor has access to the whole mortgage marketplace and, after assessing your needs, will make recommendations. The recommendation is free and there is no obligation to proceed.
YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE.
What is a mortgage?
When you take out a mortgage loan you borrow money based on how much you can afford and the value of your property. This will be for a length of time agreed between you and the lender, typically a bank or building society. The lender charges you interest on the mortgage loan, which, depending on the type of deal you have, could be reviewed and adjusted regularly.
You pay the mortgage loan back to the lender in one of two ways, repayment or interest-only. You can decide whether the interest rate you pay is variable, fixed or discounted. If you’ve experienced financial difficulties in the past and are finding it hard to obtain a mortgage loan, the Council of Mortgage Lenders (CML) has a leaflet that may help www.cml.org.uk.
Repayment methods
You have three options to repay your mortgage loan back to the lender:
- repayment;
- interest-only; or
- a combination of the two
You’ll need to decide which is best for you based on your particular circumstances and your attitude toward investment risk.
With a repayment mortgage your monthly repayments to the lender reduce the amount you owe as well as paying the interest the lender is charging you on the loan. Therefore, each month you’re paying off a small part of your mortgage loan. The advantages of a repayment mortgage is that it’s a simple, guaranteed way to repay your mortgage – so long as you maintain repayments to the mortgage lender throughout the term of the loan. Whilst each payment is reducing the outstanding loan, in the early years your repayments to the lender will be mainly be interest, so if you want to repay the mortgage or move home in the early years, you’ll find that the amount you owe to the lender probably won’t have reduced by very much.
The alternative is an interest-only mortgage loan. With this type of mortgage arrangement your monthly payments to the lender only pays the interest charged on your mortgage loan – the payments you make are not actually reducing the loan itself.
In view of this, it’s clearly important that you arrange some other way to repay the mortgage loan at the end of its term. Typically, the way to do this is through a savings or investment plan which you also pay into throughout the period of the interest-only mortgage loan.
Since most types of investments and savings plans are not guaranteed, but based on future investment performance, it is important that you monitor your investment or savings plan to ensure it grows sufficiently so that at the end of the term you’ll have enough money to repay the mortgage loan. If your investments or savings don’t grow as planned you will have a shortfall of funds available with which to repay your mortgage loan. Rectifying this shortfall will be your responsibility – not the mortgage lender’s. If you can’t repay the mortgage loan at the end of the term you could lose your home. You will therefore need to consider ways of meeting this shortfall. The advantages of an interest-only mortgage loan is that because you’re only paying off the interest on the loan, and not the loan itself, your monthly repayments to the lender will be lower than the repayment mortgage loan alternative. However, it is important to remember that with an interest-only mortgage the debt is not reducing.
