Let PAD Financial help you understand and find the right mortgage
Looking for a mortgage can be a complicated and daunting process with more than 75 different mortgage lenders offering over thousands of different mortgage deals between them. Trying to understand the differences in types of mortgage, the interest rates, the fees involved and what criteria is used behind the scenes to assess your mortgage application is a near impossible task if you are not immersed in mortgages day in day out.
This is where a chat with PAD Financial can help. We can talk you through the difference in mortgage types and help you weigh up the benefits of one rate over another, whether to extend the tie in period or reduce the term, or whatever combination would work for you, and navigate the jargon to explain in plain English what we would recommend and why.
Our mortgage advisers at PAD Financial know how complicated the mortgage market is and they are happy to answer any questions you may have. We want you to be happy that you have made the right decision and we are here to help you through the mortgage process – no hidden costs or surprises, just straightforward, honest, mortgage advice.
If you would like to know how PAD Financial can help you, please contact us now.
Understanding different types of mortgages
Learn about different kinds of rates, from fixed and variable to tracker and capped. See tab below for further details.
You can fix your interest rate for an initial period and during this period, your mortgage payments will not change, regardless of whether interest rates in the wider market rise or fall. This means that you will not pay more than agreed at outset, but you will also not benefit if interest rates fall.
This interest rate is variable based on the commercial decisions of the lender you are borrowing from. It might be higher than other rates on offer, but there is often flexibility to over pay borrowing on this rate which is useful if you are expecting a lump sum (such as an inheritance or proceeds from the sale of property) to pay off your mortgage.
In the early stages of the mortgage (or sometimes for the term of the loan) the lender might offer a discount on the variable rate. This means a lower rate initially and often the ability to overpay on the borrowing should you be in a position to do so.
This interest rate will usually follow the interest rate set by the Bank of England (but not always) and you will benefit from reductions in the base rate, but will pay more if the base rate rises.
This is where the rate starts very low and then increases during the tie-in period. This type of deal is good for people that might be buying for the first time and need money for home improvements and home furnishings in the early months.
The interest rate might move upwards, but will not move above a predetermined high point. This is good if you want the benefit of a variable, discount or tracker rate with the knowledge that you will not pay more than a certain amount.