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Questions
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Q.
What do you charge for arranging a mortgage?
We
make no charge for arranging a normal domestic mortgage. Our income comes
from the lender who pays us a commission fee. We will give you a
written statement of the amount of our commission.
Q.
What are the different types of mortgages?
There
are five main types of mortgage:
·
REPAYMENT
A
mortgage that pays back the loan and interest over a fixed period of
years. At the end of the period you own your home. Currently this is
the best type of mortgage for most borrowers.
·
INTEREST
ONLY
Only the interest due is payable during the period of the loan.
At the end of the period the original capital must be paid.
·
ENDOWMENT
MORTGAGE
Interest is payable to the lender and a premium is paid into
an endowment policy. When the endowment policy matures it will be used to
pay off the capital, assuming that there has been sufficient growth. In the
event that you die before your policy matures, your mortgage will be paid off.
·
INDIVIDUAL
SAVINGS ACCOUNT (ISA) MORTGAGE
Similar to an endowment mortgage with
the capital being paid off when the ISA(s) are cashed in.
·
PENSION
MORTGAGE
Also similar to an endowment mortgage. Contributions are made
into a personal pension plan in addition to paying the interest payment. The
outstanding capital is repaid from the tax free cash sum available from your
pension fund at maturity.
Q. What are the different types of interest rates?
·
FIXEDRATE
The
monthly payments will remain the same during the fixed rate period.
·
VARIABLERATE
The
monthly payments change when the lender changes its lending interest rates.
·
DISCOUNTED
RATE
The monthly payments are discounted from the variable rate for a
fixed period.
·
CAPPED
RATE
The monthly payments cannot rise above the 'cap' for the
specified period but may fall should the standard variable rate fall below the
capped rate.
·
FLEXIBLE
Modern
loans which allow variable payments leading to the mortgage being paid off early
using daily interest calculations. Often known as “Australian Mortgages”.
Lenders
will normally revert to their standard variable rate of interest at the end of
any period applied to their fixed, discounted or capped rates.
Q.
How much will my monthly repayments cost?
This
will depend on:
·
Your
type of mortgage.
·
The
amount you borrow.
·
The
current interest rates.
·
The
period of the loan.
To
obtain a quotation on the amount of your repayments, please complete our contact
form Contact Form
When
you ask us for a quotation we will search for the best deal and ideal mortgage
for you from our comprehensive databank of lenders and provide you with a
detailed written quotation.
You
may need to provide life assurance to cover your mortgage loan.
Q.
What happens if I have an Endowment Shortfall?
If
you are one of the thousands who are facing a potential shortfall on your
endowment mortgage – We can provide you with alternatives without increasing
your premiums.
Q.
Why does a Lender require a Valuation?
The
value of a property may vary from the selling price. As the lender bases
their security for the loan on the property value, not the selling price, they
will wish to have it valued. The lender will also base their offer for a
loan on the valuation, not the selling price.
The
amount that you may borrow will depend on several factors. For a 100%
mortgage you must normally meet the following criteria:
·
Be
in full-time employment.
·
A
totally clean credit record for a minimum of 3 years.
·
A
totally clean mortgage/rent record for a minimum of 3 years.
We
will be happy to provide advice.
Q.
Can I get a mortgage if I have had credit problems?
Yes.
If you have payment defaults, arrears or CCJ’s the maximum loan for which you
will be considered is 85%. 95% is available if you have paid your CCJs
over 12 months ago.
Q.
I already have a mortgage. If I take out a new mortgage will I be able
to save money?
Very
probably. It is often possible to make savings by re-mortgaging with a new
product, especially if you have had your mortgage for some time. It may
also be possible to raise capital for an extension or home improvements.
Remember there may be a penalty to pay if you are still in any offer period. We
will be pleased to advise you at no cost. Just complete and submit our application form.
Q.
I already have some loans. Will they affect how much I can borrow?
Yes!
All lenders take existing credit loans (e.g. car loan) into account. The total
of all your loans is then deducted from your income. The multiplying
factor is then applied to calculate how much you may borrow.
If
you do not declare any other credit commitments and a Lender discovers them
during a credit search, your application may be rejected.
Q.
Can I repay my mortgage before the end of the mortgage period?
Yes.
However, the early redemption of your mortgage or the early surrender of an
investment, may have adverse financial consequences. The actual effects will
depend on the particular type of mortgage or investment.
Q.
What happens if I fail to keep up the repayments?
It
is your responsibility to ensure that you maintain a suitable and adequate
method of repayment at all times. Your lender will remind you of this
annually. If you have difficulties in meeting repayments then you should
discuss this with your lender. Remember, if you default in your payments,
then your home will be at risk of re-possession!
Q.
Who do I ask if I have any other questions?
We
will always be willing to try and answer any questions that you may have. Do not
hesitate to contact
us.
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