Our Quick Mortgage Guide

Buying a home can be a confusing and stressful time.  There are so many stages in the process to think about and the most important is your mortgage.  After all, obtaining a mortgage is the main way that you can be sure to purchase and own the house of your dreams.

Here at Silverman Black, we are the local experts in all aspects of purchasing property here in Carshalton, Surrey.  So, to help our customers in making the process that little bit easier, we have put together our quick mortgage guide to help you understand more about this all-important stage of buying a property.

Knowing Your Repayment Options

You will need to pay off your mortgage on a monthly basis.  However, you can decide between two different types of payment:

Repayment - A repayment mortgage is one that has been calculated so that you pay off your entire debt over a specified term.  This is usually around 25 years.  Every month you will not only be paying off the interest (which decreases over time) but also the overall amount that you have borrowed.

Interest Only - Interest only mortgages are not as common as they once were.  In fact, they are often only found on buy to let properties.  They are seen as more risky than a repayment mortgage because you will only be paying off the interest on your mortgage, not the overall borrowings.

Loan To Value And Deposits

Your Loan to Value (LTV) refers to how much of the property is being funded by the mortgage company and how much you are putting forward.  The amount that you are funding is referred to as your deposit.

People who have a higher LTV are a greater risk to the lender, simply because they will need to put more money forward.  It is also more likely that the larger the deposit you have, the better deal you will get from your chosen lender. 

Mortgage Type

You will also need to choose from a variety of different mortgage types when securing the funds to buy your home.  The different types relate to the different approaches on how the interest is calculated.  The most popular varieties include:

• Variable rate - where the interest rate can move up and down, set by the lender.
• Fixed rate - where the interest rate is set at a particular level for a fixed period of time.
• Tracker - these types of mortgages track the rate that is set by the Bank of England.  They are variable, just like the variable rate, but are not set by the lender.
• Capped - capped mortgages are much like a tracker mortgage but with a fixed capped applied.

You will need to make sure that you pick a mortgage that suits your needs, thinking about your future as well as your present circumstances.

Ask An Expert

If you have any doubt about your mortgage, how to apply or the process in general, then get in touch with our team here at Silverman Black.  We have many years experience in the industry as a Carshalton Estate Agent and can help you through the entire process.  We can even put you in touch with an approved financial advisor who can make arrangements with lenders on your behalf.  Whether it is securing the mortgage you need or simply getting some overall advice, our team is here to help.  Call now on 0208 773 2929.