Repayment Methods There are basically two major types of mortgage repayment methods available in today's market:
Repayment - A Repayment Mortgage is structured so that the monthly mortgage payments, comprising partly of capital and partly of interest, pay off the original amount borrowed as well as the interest that would be accrued over the mortgage term, by the end of the term.
Interest only - So called due to the fact that you only pay interest to the lender each month. The original loan amount remains the same for the term of the loan. Therefore a suitable investment is required to run in conjunction with the mortgage in order to repay the loan balance at the end of the term. The most common investments used for this purpose include Pension, Endowment and ISA. Mortage Rates A tracker mortgage or a base rate tracker mortgage as it is sometimes referred, is a variable rate mortgage that follows the base interest rate set by the Bank of England. The interest rate on a tracker mortgage will be higher than the rates set by the bank of England but lower than the lenders fixed rate. Fixed Rate A fixed rate mortgage loan means that the rate of interest charged on your loan amount is fixed and does not change, unlike a variable rate or a tracker mortgage.
A fixed rate mortgage removes the uncertainty of a variable rate mortgage guaranteeing a stable rate for a fixed period. This fixed rate usually applies from anywhere between 2 to 5 years. The longer the fixed period usually means the higher the interest rate that is set.
For more information on the types of mortgages available and which would be most suitable to you. Click on the contact us box and enter your details for your free mortgage consultation today, or call 01202 512340 lines open 9am - 7pm Monday to Saturday and speak to a mortgage broker now.
THINK CAREFULLY BEFORE SECURING OTHER DEBTS AGAINST YOUR HOME. YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE OR ANY OTHER DEBT SECURED ON IT.
The overall cost for comparison is 8.8% APR. The actual rate available will depend upon your circumstances. Ask for a personalised illustration.
If you are thinking of consolidating existing borrowing you should be aware that you will be extending the term of the debt and increasing the total amount you repay.
J P Financial is an appointed representative of Mortgage Broking Services Limited which is authorised and regulated by the Financial Services Authority
The FSA do not regulate some forms of mortgage.
This site is intended for UK Consumers only.
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