A mortgage is probably the single biggest financial commitment you will ever make. Whether you are buying, remortgaging or investing in a Buy To Let property, the whole process can be stressful.
Therefore, taking the time to find the right deal which suits you, your life and your finances is key!
There are so many mortgage products on the market and so many lenders offering a variety of deals that selecting the right one can be difficult.
There are various factors you have to take into account.
What if the rates increase? What if my financial circumstances change?
What if I want to pay off my mortgage early?
Don’t just look at the percentage rate offered by the lender. This may seem attractive but can have conditions attached to it that could be unattractive in the long term.
LET’S START WITH THE BASICS
1. How much deposit can you put down on a property? This is the amount you will contribute to the purchase of the property. Remember to have some money left over for the valuation of the property and the solicitor fees to complete the transaction.
2. What is your total income? Either on your own or together if you are looking at a joint purchase? What can you afford to pay every month?
The 2 questions above are interlinked and will determine what you can borrow and what rate you would be looking to get. Your credit history will also be a major factor in helping a lender decide if they are willing to lend to you. Download your credit report to see your score. There are many websites that offer free credit report checks.
WHICH MORTGAGE?
Repayment
Does what it says on the tin. You pay interest and capital each month. This is spread out over the limit of your mortgage.
Traditionally most mortgages are 25 or 30 years long. You will pay equal monthly instalments to clear off the balance. You can pay lump sums off your mortgage but this is usually capped at 10% of the overall mortgage a year.
In repayment mortgages the interest element is larger in the initial years.
WHICH MORTGAGE?
Interest-only mortgage
Your monthly payments only cover the interest of the mortgage and not the lump sum of the mortgage. To settle the actual debt, you would have to take out a separate investment. This can be either an endowment policy, a pension plan or an Individual Savings Account (ISA).
The above 2 are the most common types of mortgages. There are other mortgages available and our advisors can discuss these with you and the best option that suit your needs.
AT CLEAR SKY CAPITAL WE WORK WITH QUALIFIED MORTGAGE ADVISERS TO BRING YOU THE BEST MORTGAGE TO SUIT YOUR NEEDS.
OUR BROKERS HAVE ACCESS TO THE ENTIRE MARKET.
THE RIGHT DEAL IS OUT THERE.
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