How To Compare Mortgages

How To Compare Mortgages



How to​ Compare Mortgages
A mortgage is​ really nothing more than a​ specialised type of​ loan that banks and building societies issue to​ those who qualify to​ enable them to​ buy a​ house .​
There are so many mortgages on​ offer that it​ has become essential to​ compare mortgages before coming to​ a​ firm decision .​
It would probably be possible to​ borrow money in​ some other way to​ finance the​ buying of​ a​ house,​ but mortgages are the​ easiest way to​ do so,​ and have become the​ accepted standard way.
When you​ consider buying a​ house you​ will probably also have to​ consider taking out a​ mortgage .​
Sometimes the​ different offers can be confusing and difficult to​ comprehend .​
For these reasons you​ need to​ carefully compare mortgages.
It is​ possible to​ get a​ 100% mortgage,​ meaning that you​ will receive a​ loan for all the​ money you​ need and not have to​ come up with an​ agreed deposit amount .​
This may seem attractive at​ first,​ but it​ is​ likely that the​ lender will charge you​ much more for their services,​ making this kind of​ mortgage less attractive than it​ may first seem.
It is​ even possible these days to​ get 120% or​ even higher mortgages,​ giving you​ some money to​ use over and above what you​ need for the​ actual purchase .​
But consider this: the​ value of​ your house will actually be less than the​ value of​ your mortgage .​
This is​ not a​ very solid basis for borrowing,​ as​ the​ only thing you​ have as​ security is​ the​ house itself .​
If it​ all goes wrong,​ where will you​ find the​ extra 20% from?
The mortgage rate of​ interest is​ probably the​ main element to​ consider when you​ compare mortgages .​
This determines how much over and above the​ actual amount borrowed you​ will pay back .​
Your main choice will be between a​ repayment and an​ interest only mortgage .​
This means that you​ will be paying either only the​ interest on​ the​ money you​ have borrowed,​ or​ you​ will repay a​ portion of​ the​ capital plus interest on​ the​ money borrowed .​
Of course,​ with an​ interest only mortgage you​ will still have to​ repay the​ capital at​ some time; you​ don't get away with it​ altogether!
There are many mortgage types to​ consider .​
There are first time buyer mortgages,​ self certification mortgages,​ buy to​ let mortgages,​ capped mortgages,​ discount mortgages,​ fixed rate mortgages,​ and more .​
Some of​ these are self-explanatory,​ but others may be confusing for someone who is​ not too familiar with the​ world of​ mortgages.
The first time buyer mortgage is​ of​ course aimed at​ the​ first time buyer .​
This is​ a​ relatively easy mortgage to​ secure as​ it​ takes into consideration the​ problems facing first time buyers .​
For example,​ people in​ this situation are probably young and do not have a​ long career history .​
They probably also don't have much savings either .​
Rather than discriminate against someone in​ this position,​ these mortgages make it​ easy to​ apply and receive.
A mortgage is​ probably the​ biggest amount of​ money you​ will ever borrow .​
For this reason it​ is​ vitally important that you​ compare mortgages carefully to​ be able to​ discover which one is​ best for you​ and you​ needs,​ as​ well as​ you​ repayment ability.




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