How much can I borrow
Traditional lenders, such as high street banks, take a different approach to mortgage applications due to the new rules surrounding the mortgage lending market.
Lenders now focus more on affordability, and will require details of the following to support an application:
- Your credit history
- Details of your previous employment
- Proof of your income
- Your monthly outgoings
If you have poor credit, then you can still access a mortgage.
Find out what you could borrow with the mortgage table above.
How to calculate mortgage repayments
You can find out exactly how much you need to pay each month by using our mortgage calculator.
To see what mortgages you could access, complete the mortgage calculator fields. Enter the purpose of your mortgage, the value of the property, the amount you wish to borrow, the type of mortgage you want (either capital and interest or interest only mortgage, the length of mortgage, to see what mortgages are available to you.
What is a fixed rate mortgage
A fixed rate mortgage could enable you to secure a set interest rate on your mortgage for a number of years. The majority of banks offer fixed rate mortgages for 2,3,5 or 10 years.
When looking at fixed rate mortgages, you should bear in mind that an attractive interest rate today may not look too good in the near future. This is because interest rates could change over the course of your fixed term, which means you could end up paying more in interest than necessary.
Post Office are offering some great fixed rates on their mortgages.
What is a tracker rate mortgage
Tracker mortgages’ interest rates are closely linked to the Bank of England’s base interest rate. Therefore, if the Bank of England increases their base interest rate, then tracker mortgages hike their interest rates.
Repayment or interest only
A mortgage that requires you to pay both the capital and the interest on a mortgage is called a repayment mortgage. This type of mortgage allows you to eventually own the property outright. It should be noted, as you are paying both the capital and interest of a mortgage, these mortgages tend to be more expensive than others.
If you want to keep your monthly mortgage payments to a minimum, you might want to take out an interest only mortgage. With these mortgages, you only need to pay the interest on the mortgage; this keeps the monthly payments down. However, it should be noted that this type of mortgage does not allow you to own the property at the end of the finance.
Making overpayments on your mortgage may seem like an attractive idea, as it allows you to reduce your remaining mortgage significantly. There are some more flexible lenders that allow overpayments. However, a number of lenders will charge early repayment charges to those who repay their mortgage too quickly.
If you want to explore your mortgage options, it is a good idea to speak to an independent mortgage broker who will be able to offer impartial advice.