Mortgage Solutions Wales Getting Mortgages For You.

Tel: 0845 2911104
Email: admin@mssmortgages.co.uk

When you choose a mortgage, you'll need to think about whether it should be on a repayment or interest only basis and any other special features that may apply. The most suitable one for you will depend on your needs and circumstances, so it's important to understand your options.

We have expert advisers on hand to help you through the decision making process, but in the meantime here's our guide to the mortgage options available. There are two main ways to repay your mortgage - these are called 'repayment' and 'interest-only'.

Repayment Mortgage:

With this type of mortgage (also known as capital and interest) you repay part of the amount borrowed together with the interest being charged each month. In the earlier years the majority of your monthly repayment is made up of interest, however toward the latter part of your mortgage term the situation is reversed with the majority of your monthly payment reducing the amount borrowed.

Interest-Only Mortgage:

With this type of mortgage you are only paying interest each month. This means that although your payments will be lower, the amount you borrowed will still be outstanding at the end of the mortgage term. You'll need to make alternative arrangements to pay off the mortgage to avoid the property having to be sold.

Our Exclusive Mortgage Deals:

We have access to exclusive deals through Legal & General's Mortgage Club, some of which are only available to our customers. Our expert mortgage advisers will be able to let you know what the latest exclusive deals are and whether they fit with your personal circumstances. These deals are not available anywhere else on the high street.

Buy To Let Mortgages:

Apart from the purposeof the mortgage, the main difference with a buy to let mortgage is that the lender takes into account the rent you will earn from the property as the primary source of income. Some may also take the landlord's personal income into account.

Typically lenders will want prospective rental income, verified by independent sources, to meet at least 125% of the monthly interest payment on the loan. This will either be based on the pay rate for fixed or tracker deals (i.e. the initial rate before the deal ends) or the lender's standard variable rate (potentially plus an extra 1%+). Lenders will generally only lend to those with larger deposits, with most deals asking for a least 30% put down by borrowers. The best deals are at the lowest loan to values of 60% or below.

Types of Mortgages Available:

Lender's Standard Variable Rate - Take the rough with the smooth
Your payments will rise and fall in line with Bank of England base rate changes but not necessarily at the same time or by the same amount.

Discounted Variable Rate - A gentler way to start your mortgage at a time when money may be tight you pay a lower interest rate which moves in line with the lender's standard variable rate for a set period.

Tracker Variable Rate - Your payments change when interest rates fall or rise.Tracker rates are usually linked to the Bank of England base rate, which means they'll change in line with changes to the base rate.

Fixed Rate - Gives you the security of knowing that your monthly payments are the same.
You pay a fixed rate of interest for a set period, so you know exactly what you'll be paying each month even if interest rates change.

Capped Rate - You will know the maximum you will pay for a set period of time to help you budget. You pay a variable interest rate, but your payments won't go above a certain amount for a set period of time.

Offset Mortgage - Your savings will be offset against your outstanding mortgage.Your main current account, savings account or both are linked to your mortgage. Each month, the amount in these accounts is offset against your outstanding mortgage before working out the interest you owe. You are unlikely to earn interest on your savings which are offset against your mortgage.

Cashback Mortgage - Great if you need a cash lump sum. The lender pays you a sum shortly after you take up the loan but if you move to another lender in the early years you may have to pay some or all of this back. Typically interest rates are higher for this type of mortgage.

Flexible Mortgage - You may be able to vary the amount you pay each month and take payment holidays in some circumstances. It may help to reduce your mortgage with lump sum payments without incurring an early repayment charge.

One of our expert mortgage advisers will help you through the process step-by-step, working out how much you can borrow, how much it will cost, and what type of mortgage may be most suitable for you.

They will even take care of all the mortgage paperwork for you, so you don't need to worry about a thing.

Your home may be repossessed if you do not keep up repayments on your mortgage.

A fee may be charged for mortgage advice. A typical example is £500. The precise amount will depend on your circumstances.

Tel: 0845 2911104
Email: admin@mssmortgages.co.uk