Mortgages can basically be divided into two different types according to how you pay them off:
Before you decide on a mortgage, work out how big your budget is and how much you’ll be able to repay each month.
Don’t overstretch yourself because you could find making repayments difficult if interest rates increase or your situation changes. When calculating your budget you’ll also need to include added costs such as the loan for a deposit – if you haven’t money saved for this – buildings and contents insurance and life insurance.
Different mortgage providers have different criteria for lending money, but in general the amount you can borrow depends on:
Before you start looking for a new home or decide to increase your mortgage, it makes sense to know how much you can borrow. Lender’s attitudes vary, but they will usually lend you between 3 and 4.5 times your annual income before tax if you’re applying for a mortgage on your own. If you’re applying with somebody else, they will usually lend either between 3 and 4.5 times the main income plus the second income or 2.5 and 4 times the two incomes added together.
Lenders will normally ask for anything up to six pay slips. If you’re self-employed you will need three years of accounts to verify your income. They may also ask for bank statements and references.
If you can afford to put down a large deposit, measured as a percentage of the value of the home, banks and building societies maybe more willing to agree to a mortgage.
The longer you borrow the money for, the more interest you will pay. However, the longer the mortgage term, the lower your repayments will be each month. Typically, a mortgage term lasts 25 years.
There may be extra charges connected to your mortgage application:
There are some competitive deals to be had but if something sounds too good to be true, it probably is, so don’t rush into anything you’re not sure about.
We will be processing all personal information in accordance with Data Protection legislation. The details that you have provided will only be used to contact you by telephone, post or email regarding your selling and buying needs and in order to introduce moving services from our associated companies.
YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE. Written quotations are available on request. Subject to status. Contracts of insurance may be required. A professional brokerage fee of up to 1.95% may be charged.
Advanced Mortgages & financial Services Ltd are authorised and regulated by the Financial Services Authority for non investment protection, residential mortgages and general Insurance business.Our FSA ID number is 400614, our company ID number is 04205784 and our Consumer Credit License number is 505025.