Three Steps To MORTGAGE Happiness
In fact there is many ways to obtain/get a success mortgage but to three things hereunder have earned explain in its entirety.
Most homeowners accept their mortgage as a necessary evil, a millstone of debt, a long-term burden, a serious pain in the pocket to be ignored as far as possible.
However this ostrich-like behaviour can have serious consequences for your bank balance. With thousand of different mortgages available from hundreds of lenders, the market place offers many ways to reduce your mortgage debt.
So dig out your mortgage agreement from the back of the filling cabinet and get pro-active.
Here are three steps that’ll help you seriously lighten the burden.
Step One: Shop Around
Shop around for a better deal. Newspapers and websites are good places to look for regularly updated best buys. You can see our best buy tables here
Make sure that your mortgage suits you. Rates can vary enormously between lenders – anything between 4.5% for fixed rate deals to 6.5% - that's a difference of up to £1600 per year on a £100,000 loan!
Check your existing lender's deals - it’s often cheaper to move mortgage within your current lender's range of products than to go outside. Go and talk to the mortgage advisor and ask for a better deal – the threat of losing a customer can have a surprising effect on a hard-nosed lender!
Beware additional costs: you may have to pay a penalty if you move your loan. Read the small print of any new loan to ensure the lender isn’t hiding some of the costs in order to offer a tempting rate.
Compare all the costs of the mortgages you’re interested in with your existing mortgage over a period of a couple of years. The easiest way to do this is via the APR
Shop around for better rates on your insurance premiums as well. Rates for the kinds of insurance associated with your mortgage: life insurance, mortgage protection insurance, critical illness protection, are often over-priced. Check the internet and in newspapers for better deals.
Step Two: Watch the rates.
Obviously the rise and fall of interest rates can have a big impact on your mortgage repayments but what should you do if rates change?
Many people will react to a period of interest rate stability by moving to a tracker mortgage and to a period of interest rate rise by opting for the stability of a fixed rate.
Wrong!
Fixed rate mortgages are usually better when prices are low or stable and rise to protect the lenders investment when rates rise. Although it might seem counter-intuitive to do so, consider cheap fixed deals when interest rates fall.
If you do take out a fixed mortgage at a favourable rate remember: you’ll have to shop around when the fixed period comes to an end to avoid a sudden, unwelcome, hike in your payments.
Step Three: Take an interest in your interest.
With average standard mortgage rates currently running at 6.8% a 25 year repayment mortgage on a loan of £100,000 would cost £210,600. You will pay more than the original loan in interest – a whopping £110,600!
You can cut the interest you pay, at the front end as it were, by getting a better deal on your interest rate but you can also pay less interest by paying the debt off more quickly.
Some mortgages allow the borrower to pay more each month or to pay off lump sums:
Flexible mortgages - where the interest is calculated daily and you can increase or decrease your repayment depending on your situation (do check that there are no fees or penalties).
Current Account Mortgages turn your loan into an overdraft and puts all your debt in one pot, allowing you to pay in and take out when you need to.
Offset mortgages work like flexible mortgages but allow you to reduce your interest bill by using savings.
And bear in mind that paying a larger amount monthly not only reduces your total interest bill but also reduces the length of the mortgage
Don’t let your mortgage cost more than necessary. A little bit of research could save you thousands of pounds.
Read more about Mortgage Basics
See contents of Full Mortgages Guide
See contents of Home Buyers Guide
I've read enough for now and want to get a free Quick Mortgage Quote
Mortgage Basics
What is a mortgage?
A basic summary of the rules
How much can you borrow?
How do you prove your income?
How long are mortgages usually for?
How to get a Mortgage in the UK
Here we give you a step by step guide on how to get a mortgage with special tips
I'm employed - shortcut
I'm self-employed - shortcut
I'm buying my first mortgage - shortcut
I've got a bad credit history - shortcut
Mortgage Basics
How to Choose your Mortgage
Types of Mortgage
Where to Find your Mortgage
Getting a Mortgage in Principle
TOP TIPS
Three Steps To MORTGAGE Happiness
Most homeowners accept their mortgage as a necessary evil, a millstone of debt, a long-term burden, a serious pain in the pocket to be ignored as far as possible.
However this ostrich-like behaviour can have serious consequences for your bank balance. With thousand of different mortgages available from hundreds of lenders, the market place offers many ways to reduce your mortgage debt.
So dig out your mortgage agreement from the back of the filling cabinet and get pro-active.
Here are three steps that’ll help you seriously lighten the burden.
Step One: Shop Around
Shop around for a better deal. Newspapers and websites are good places to look for regularly updated best buys. You can see our best buy tables here
Make sure that your mortgage suits you. Rates can vary enormously between lenders – anything between 4.5% for fixed rate deals to 6.5% - that's a difference of up to £1600 per year on a £100,000 loan!
Check your existing lender's deals - it’s often cheaper to move mortgage within your current lender's range of products than to go outside. Go and talk to the mortgage advisor and ask for a better deal – the threat of losing a customer can have a surprising effect on a hard-nosed lender!
Beware additional costs: you may have to pay a penalty if you move your loan. Read the small print of any new loan to ensure the lender isn’t hiding some of the costs in order to offer a tempting rate.
Compare all the costs of the mortgages you’re interested in with your existing mortgage over a period of a couple of years. The easiest way to do this is via the APR
Shop around for better rates on your insurance premiums as well. Rates for the kinds of insurance associated with your mortgage: life insurance, mortgage protection insurance, critical illness protection, are often over-priced. Check the internet and in newspapers for better deals.
Step Two: Watch the rates.
Obviously the rise and fall of interest rates can have a big impact on your mortgage repayments but what should you do if rates change?
Many people will react to a period of interest rate stability by moving to a tracker mortgage and to a period of interest rate rise by opting for the stability of a fixed rate.
Wrong!
Fixed rate mortgages are usually better when prices are low or stable and rise to protect the lenders investment when rates rise. Although it might seem counter-intuitive to do so, consider cheap fixed deals when interest rates fall.
If you do take out a fixed mortgage at a favourable rate remember: you’ll have to shop around when the fixed period comes to an end to avoid a sudden, unwelcome, hike in your payments.
Step Three: Take an interest in your interest.
With average standard mortgage rates currently running at 6.8% a 25 year repayment mortgage on a loan of £100,000 would cost £210,600. You will pay more than the original loan in interest – a whopping £110,600!
You can cut the interest you pay, at the front end as it were, by getting a better deal on your interest rate but you can also pay less interest by paying the debt off more quickly.
Some mortgages allow the borrower to pay more each month or to pay off lump sums:
Flexible mortgages - where the interest is calculated daily and you can increase or decrease your repayment depending on your situation (do check that there are no fees or penalties).
Current Account Mortgages turn your loan into an overdraft and puts all your debt in one pot, allowing you to pay in and take out when you need to.
Offset mortgages work like flexible mortgages but allow you to reduce your interest bill by using savings.
And bear in mind that paying a larger amount monthly not only reduces your total interest bill but also reduces the length of the mortgage
Don’t let your mortgage cost more than necessary. A little bit of research could save you thousands of pounds.
Read more about Mortgage Basics
See contents of Full Mortgages Guide
See contents of Home Buyers Guide
I've read enough for now and want to get a free Quick Mortgage Quote
Mortgage Basics
What is a mortgage?
A basic summary of the rules
How much can you borrow?
How do you prove your income?
How long are mortgages usually for?
How to get a Mortgage in the UK
Here we give you a step by step guide on how to get a mortgage with special tips
I'm employed - shortcut
I'm self-employed - shortcut
I'm buying my first mortgage - shortcut
I've got a bad credit history - shortcut
Mortgage Basics
How to Choose your Mortgage
Types of Mortgage
Where to Find your Mortgage
Getting a Mortgage in Principle
TOP TIPS
Three Steps To MORTGAGE Happiness
posted by !GOD BLESS YOU! at 00:34
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