01244 311438

 

Chester Mortgage Centre will advise on, and recommend, the best mortgage product to suit your requirements and criteria.

 

There are two main types of repayment method:

 

Repayment Mortgage

 

With this option your monthly payment covers the interest on the loan and an amount to repay the debt.  If all payments are made the mortgage will be repaid in full at the end of the term.

 

Interest Only Mortgage

 

The monthly payments with this option only cover the interest and so therefore none of the outstanding debt is repaid and at the end of the term you will still owe the amount originally borrowed.  Therefore you would need to make a separate payment each month into an investment vehicle to pay off the debt.

 

There are many different types of mortgage product including:

 

Fixed-Rate Mortgages

 

With this type of mortgage no matter what happens to the Bank of England Base Rate your monthly repayments will remain the same for the duration of the fixed rate deal.  There are usually early repayment charges payable during the fixed rate period.

 

Capped-Rate Mortgages

 

These mortgages have a variable interest rate but there is an upper limit or ‘cap’ on the interest rate charged.  Therefore if interest rates fall the rate will fall but should interest rates rise the rate payable will not increase beyond the ‘capped’ rate.

  

Discount Mortgages

 

This is where lenders offer an initial discount off their standard variable rate (SVR) for a period of time.  The product then reverts to the lenders SVR once the discount period is over.

 

Tracker Mortgages

 

Base rate tracker mortgages mirror any changes in the Bank of England Base Rate.  Interest in usually charged at a set percentage either below, at or above the Base Rate.  This can be for an initial period of time or for the duration of the loan.

 

Offset Mortgages

 

Offset mortgages usually offer flexible facilities whereby you can make overpayments and underpayments but importantly the mortgage is linked to another credit account with the same lender.  Any credit balance in that account is offset against the debit account e.g. mortgage.  Interest is not normally paid on the credit account but you don’t pay interest on the equivalent amount of mortgage debt.

 

For advice or explanation of any type of mortgage product please do not hesitate to contact Chester Mortgage Centre.