Mortgages Question...?

Question

Basically i would like a simple answer as to what is the best type of mortgage to go for and an explanation of it? as i am very confused over who is best to go with etc help?!

Answer 1

it really depends on what ur personal circumstances are... go to a couple of banks and they'll chat u though it...so many factors play in.. like:
do u wana pay it off as early as possible..
how much u wana borrow..
what percentage of the value u want..
.how uch you wana pay a month...
do you want payment breaks....

Answer 2

The best, and most straight forward Mortgage is called a repayment mortgage.

In simple terms you pay an amount each month that guarantees that at the end of the mortgage term all you borrowed is paid off.

The only problem can be that as interest rates change so does your payment, so it is best to go for a fixed interest rate, for at least 2 years. That way you know exactly what you are going to be paying and any change in interest rates does not affect you.

At the moment the best advice suggests staying clear of endowment type mortgage.

Remember, if you do not keep up payments on a mortgage or other secured loan your house is at risk.

Take a walk down to any reputable lender, I'm sure they will be happy to help you through the maze.

Answer 3

Depends on what you want.
Interest only, you pay off the monthly interest without paying off the capital loan. You are betting the house will increase in price to give you enough equity at the end of the term to have dosh in your pocket. a £36k loan is £166.00 pcm interest only.
Fixed rate, a rate set by the lender and you pay a fixed amount per month. You know your outgoings and you are hoping the base rate of the Bank of England does not fall. You are protected should it rise. You pay off the interest and the loan over the term of the loan, usually 25 years at the moment.
Variable tracker, tracks the rate of the Bank of England base rate plus a % of perhaps 3/4%. If the base rate climbs, your payments track that climb hence the name. If the base rate falls your payments go down.
It really pays to shop around. Are you in the UK? Different issues in England and Wales to Scotland.
Sit down with a mortgage adviser and don't leave until you have a package that suits your circumstances sorted out. Go into the meeting with a clear idea of all your outgoings and know what you can afford to pay each month. It would help to prepare an income and expenditure list for the adviser.
Some areas in Scotland give £20k start up money to 1st time buyers.
Don't forget the big supermarkets lend money as well as banks and building societies.

Answer 4

Go with a 15 year fixed mortgage. No points or orgination fees(hidden points). Whether you can get this will depends on your income, credit and how much you want to borrow. Stay away from adjustable rate mortgages. Interest rates are low and they will most likely adjust up. Stay away from interest-only loans. They will tell you that you can pay on the principle whenever you want. People don't. They start doing like they do their credit cards and just pay the minimum. Most interest-only loans will convert to adjustable rate mortgages at some point and some to a balloon payment. Stay away from anything with a balloon payment. Don't count on selling before adjustable rates adjust up, inerest-only convert, or balloon payments are due. Pretty much all but fixed rate mortgages were set up for very special situations. Lately, because of the housing boom, people have been using unconventional mortgages to get into houses they really couldn't afford. Thus, the foreclosers have increased.

Get a fixed 15, 20 or 30 year mortgage on a house where the payments or no more than a fourth of your income. This will allow you to save money, eat, clothe yourself, etc.....Get pre-approved for a mortgage before even seeing your first house. You need to know where you stand relating to credit score, how much you can borrow, and at what rate. Stay away from all these answers trying to get you to go to their website for a mortgage. There are plenty of reputable mortgage lenders out there.

Answer 5

It all depends on what is that you need. A fixed rate is the best one, but you should only get this if you have good credit and you're planning on living on this house for a very long time.
A fixed rate gives a borrower security that the payments will always be the same, and if you don't have good credit you might get stuck with a high interest rate. If you don't have good credit... look into an adjustable rate... that way you'll have a couple years to fix it, and then getting a lower fixed interest rate. But it all depends on your situation on what are your future plans and how owning a house might influence your economically.

The only program I don't suggest unless you fully completely understand is the programs where you pay interest only or even just a minimum payment... there are commonly known as Option Arms.

Answer 6

I think it all depends on personal circumstances.

I was always told by my dad not to go for an Endowment Policy, I have since seen so many people with endowment mortgages freak out at thier short falls.

At first I got a 3yr fixed rate mortgage. This meant that the payments for the first 3 years did not alter and I knew what would come out of my bank each month. That was great for me to sort out my finances as it was my first house, and knew how much to put to one side for my payments.

If I were you, I would go and get an appointment with a financial advisor/mortgage advisor who can explain everything fully and tell you about deals that they have access to. Not all mortgage advisors are tied to one company and will show you offers from other companies for comparison.

Good luck!

Answer 7

A fixed rate is much better than adjustable, since you know what you're paying and the cost can't rise. Interest-only mortgages can be dangerous, since you're not building any equity.

Go with whatever reputable lender will give you the loan you want at the best rates. Be sure to include closing costs in your calculation.

If you have a realtor, they'll probably suggest a lender. You don't have to go with their suggestion if you find something better, but it can simplify things for you.

Good luck.

Answer 8

there are a number of different types.

repayment - you pay interest and small amount of capital each month. over time your interest drops but you payt the same, paying off capital quicker towards the end.

endowment - you pay interest and an insurance savings premium. At the end of the term the endowment matures and is used to pay off the amount borrowed. if it's too much you get the difference if its not enough you have to find the difference. in the early 80s loads of people were advised to switch to these (because introducers made loads of commision) when it wasnt in their best interest giving rise to the current compensation claims that are going in.

interest only - you pay the interest and have some other method to pay off the capital at the end of the term.

then within these you can have - tracker (the interest goes up and down with the bank of englands base rate changes), fixed (the interest rate is fixed for a specified period of time - great for budgeting, but not so good if interest rates drop) and capped (like tracker but with a maximum)

Answer 9

Well the best mortgage to go with generally it is a fixed rate full amortization (which means you payments will go toward making the balance go down) But truthfully it all depends on your particular situation. As far as the best company to go with, that is up to you to decide but I can tell you if you want the most competitive rates, great loan terms and service. http://www.justgetaloan.net is one of the best places to get qualified for your mortgage. Feel free to log onto the site there are also other tools and information that you can utilize to help your decision easier. Feel free to contact me directly at 866 530 7300 ext 7305 or at [e-mail]

Answer 10

Depending on your financial status there are several different types of mortgages that can be most beneficial to you,however you need to review your options with someone in that field. What city or state are you in have you spoken with anyone yet?

Answer 11

Talk to an independent Mortgage Broker who will explain things www.thepremiergroup.co.uk