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Types of mortgage

When you apply for a mortgage we help you to make an informed decision about which mortgage is most suitable for your circumstances.  We advise on both large mortgages over £500k and 75% loan to value mortgages or less. This will depend on an assessment of your income/outgoings and how quickly you are able to repay your mortgage. The majority of mortgages are based on a 2, 3 and 5 year repayment term.

We explain the options to choose from below:

Pricing options Fixed rate mortgages

  • Monthly repayments stay the same each month giving you security and certainty
  • Can be flexible to allow you to repay more quickly over time
  • Two year fixed rates most popular in UK

 

  • More expensive than tracker options but are less risky and more predictable
Tracker mortgages

  • Mortgage repayment will vary according to changes in the Bank of England base rate and not the lenders Standard Variable Rate (SVR)
  • Flexible and can be arranged without early repayment charges
  • Cheaper than fixed rate mortgages but are less predictable.
Structure 

 

 

Discounted rates

  • Linked to lender’s standard variable rate (SVR) which moves up and down at the lenders discretion
  • Not linked to changes in Bank of England base rate but changes in lenders variable rate
  • Lenders will not always pass on any savings made but will often pass on increased rates

 

SVR

  • Default lender rate for when mortgage term expires
  • Rates are rarely competitive and do not offer value for money compared with market rates
  • The lender is not obligated to pass on cost savings if rate goes down
Repayment options 

 

 

 

Repayment

  • Provides most secure plan for paying off your mortgage with a set time
  • This payment covers the interest of the loan as well as some of the debt
  • Interest owed will decrease over time as the period of the loan matures
  • Cost effective and reliable

 

Interest only

  • Monthly payment only
  • High risk
  • Covers only the interest on the loan, not its repayments
  • You must be able to meet the full repayment of the mortgage at the end of the term
  • In order to repay an interest only mortgage you may need another financial product such as a pension, ISA, investment portfolio or trust.

 

FCA
Springtide Capital Limited is authorised and regulated by the Financial Conduct Authority.

Important Legal Information
There may be a fee for mortgage advice. The precise amount will depend upon your circumstances and loan amount. The FCA does not regulate most buy-to-let, second charge or commercial mortgages. The Financial Ombudsman Service is available at www.financial-ombudsman.org.uk or by contacting them on 0800 023 4 567. YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE.

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