Compare alternatives to Derbyshire mortgages
There are many different types of mortgages offered across the market with most tailored towards specific types of borrowers. The following are some of the most common mortgage types that you can choose from.
First Time Buyer mortgages
For first time buyers, finding the money for a deposit is often the biggest challenge. Many providers make things easier by offering mortgages of up to 95% of a property’s value, so first time buyers only need to raise 5% as a deposit.
Some even offer 100% mortgages if a relative of the borrower is willing to put their home up as collateral against part of the loan. Many providers also offer discounted interest rates for an introductory period to help attract new borrowers.
Buy to Let mortgages
Landlords usually need to take out mortgages specifically aimed at their sector to buy a property to rent out. Buy to let mortgages usually offer up to 80% of a property’s value as a loan and the amount you borrow may also take into account the monthly rental value of the property. Some lenders will want the monthly rent to cover the monthly interest payments, plus an extra 25%.
Switching your mortgage to a new provider can allow you to find a better deal, thus reducing your monthly payments. It can also let you borrow more, meaning that once your old mortgage is paid off, you will be left with a spare lump sum for home improvements or other purposes.
Second charge mortgage
An alternate way to raise extra funds is to take out a second secured loan on your property in addition to your existing mortgage. This can be cheaper if you have a particularly good deal from your current provider. This additional borrowing is often referred to as a second charge mortgage. Some providers will allow you to take your total secured borrowing up to 90% of your property’s market value with a second charge mortgage.
Loan to value ratio
Most providers will base their decision on how much to lend you at least partially on your loan to value (LTV) ratio. This is a way of showing how much you want to borrow as a percentage of your property’s market value.
For example, if you want to take out a mortgage for £50,000 on a property worth £100,000, that would equal a LTV of 50%. LTV takes into account all borrowing secured against a property, so if you already have a mortgage and want to take out an additional secured loan, the two loans will be added together to calculate the LTV.
Most lenders will tend to give better rates on mortgages with a low LTV as this is seen as being less risky for them.
Find the best deals on mortgage rates
Want to get the best deal on your mortgage without a lot of fuss? Our mortgage calculator allows you to compare some of the top deals from across the mortgage industry all in one place.
All you need to do is head to the top of the page and input some basic information, including how much you need to borrow, how long for and why. Then the calculator will show you the best matches for your requirements.
Independent Mortgage Advice
Remortgaging is particularly popular at the moment as interest rates are low.
Whether it will be a good idea for you to remortgage depends on a number of factors, including your goals and your personal circumstances.
However, in general, if interest rates are lower than you are currently paying on your mortgage, it may be a good time to remortgage.
If interest rate are higher than you are currently paying, it may be better to look at other options, such as a second mortgage or a personal loan (if you aim is to borrow more).
If you are not sure whether now is the right time to remortgage, it is a good idea to speak to an independent mortgage broker who will be able to offer impartial advice.