Hot Topics
- Income Multiples Explained
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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 During The Mortgage Application Process?
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The mortgage application process, once underway, does not take very long. Once you have decided to go with a certain lender and signed a purchase contract, the lender will run a full credit check verifying your income, liabilities and your ability to repay the loan.
- What Are Redemption Penalties?
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Redemption penalties are your lender’s way of getting extra money out of you when you decide to cancel your mortgage agreement early.
- What are 100% Mortgages?
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Most mortgage lenders will only offer a 90% loan to value, that means that they will only loan you 90% of the properties value. First time buyers find this particularly problematic because they need to save up there 10% of the properties value before they can complete on their mortgage.
- What are Self Certification Mortgages?
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When you apply for a mortgage, the lender will require from you proof that you will be able to maintain the mortgage payments, and do not present a risk of non-payment for the large amount of money you are borrowing.
How long are mortgages usually for?
As with any loan, you can choose to take your mortgage out for any amount of time – however the norm is 25 years.
The longest term you can take a mortgage out over is generally 35 years. 15 or 20 year mortgages are also quite common.
It’s a good idea to take out as short a mortgage term as possible purely because you will pay a lot less in interest. The shorter the term the higher the monthly repayments, however the amount you actually have to pay back will be greatly reduced. Basically you have to choose a mortgage term that is right for you, and if you find that you could pay more you can always remortgage for a shorter term, or if you have a flexible mortgage you can simply pay more off your mortgage and finish the mortgage early. With a flexible or current account mortgage there will be no redemption penalties for paying off early.
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