There are vast arrays of mortgages available. The deals on offer change weekly as companies compete for business. Estate agents are keen to offer financial advice to home buyers; they are rarely independent often being tied to one of the large insurance companies.
An independent financial adviser can offer the best deals for all constituent parts of a mortgage. There are many different mortgage options available listed below:
Fixed Rate allows you to fix the interest rate of your loan so that for a set period you have the reassurance of knowing that your repayments will not alter.
A Capped Rate fixes a upper ceiling to the interest rates so that in the event of rising interest rates you will not pay any more than the limit set by the cap. If rates fall below the cap then your repayments will reduce. Fixed and Capped rate mortgages are most suitable to those who are working to a budget and need to know that their repayments will not exceed a set figure.
Discounted Rate mortgages allow a discount to the standard variable interest rate for a set period. As an incentive to attract new clients many companies now offer a lump sum Cash back. These are obviously useful if cash is needed at the outset, however the opening interest rates may not be as attractive.
Flexible Mortgages, also termed Australian mortgages have become increasingly popular with the self employed and short term contract workers. They allow the borrower to vary the terms of their mortgage perhaps by altering the monthly payments or by paying off lump sums. Other options include the facility to take payment holidays and to borrow further amounts.
Redemption Charges: Mortgage lenders hope to retain their clients by making it difficult to move their mortgage by imposing redemption charges, these are likely to apply during the first few years of a new mortgage. Schemes are available which exclude these charges