Hot Topics

Income Multiples Explained: If you are an employee, the majority of mortgage lenders will calculate the maximum size of a mortgage loan based on your salary.
What Happens If I Can’t Keep Up My Repayments?: It is very important that if you are having problems meeting your mortgage repayments, you talk to your mortgage lender straight away.
Is There Any Way I Can Lower My Monthly Repayments Without Switching Mortgages?: If you find that you cannot afford your monthly mortgage repayments and do not wish to switch your mortgage to another lender – then you will need to negotiate new terms with your existing lender.
Low Setup Cost Mortgages: When you apply for a mortgage and to buy a property, there are certain initial costs that are, on the whole, unavoidable.
I Have Been Turned Down For A Loan Or Credit Card, Will I Still Be Able To Get A Mortgage?: If you have been turned down for a credit card or loan, then you need to find out why your application was rejected before you apply for a mortgage.

How Is Interest Calculated On a Mortgage?

Interest is charged in different ways depending on what kind of mortgage you have.

With many modern mortgages where you have the opportunity to make payments at any time, your interest will be calculated on a daily basis. This generally means that your interest will be charged on the balance outstanding at the end of each day so you can benefit immediately from any payments of capital. It also means, however, that if you miss a payment or are late with payments, more interest will be charged. You will also be charged interest on any unpaid fees or premiums.

There are also many mortgages where the interest is worked out once a year, these are called 'annual interest' or 'annual rest' loans.

Mortgages which calculate your interest on a daily basis offer you a better deal because they instantly reflect your payments, reducing your total interest bill.