Frequently Asked Questions
Below is a list of questions that we are frequently asked by our clients. If you cannot find the answer to your particular question, no worries just give one of our Advisers a call on 0800 345 7550 (free phone) or please contact us through the contact page.
Will it be difficult to get a mortgage if I’ve been in debt in the past?
What is an interest only mortgage?
What type of interest rate products are there?
What insurances are necessary?
What are Current Account and Offset Mortgages?
What can I use the cash for?
You can use the equity, or extra cash value, you have in your home for any purpose. You may want to make essential home improvements like a new kitchen or bathroom. You could build a conservatory or buy a new car. On the other hand, you may want to use the cash to pay off other, more expensive debts like store cards, credit cards and other loans. How you spend the money is entirely up to you - even down to treating the family to a well-deserved holiday!
Will it be difficult to get a mortgage if I’ve been in debt in the past?
If your debt has now been repaid, was a one-off problem and is unlikely to happen again, you may still be able to get a mortgage. Even if your debt problems were more persistent, we should still be able to help you.
We specialise in helping people who have had credit problems such as County Court Judgements (CCJs), defaults, mortgage arrears or bankruptcy.
Your home may be repossessed if you do not keep up payments on your mortgage.
What is a mortgage?
A loan secured against the value of a property to help you buy a home, pay for home improvements or to cover many other sorts of spending, for example, consolidating existing debts. We advise all our customers to think carefully before securing other debts against their home. Your home may be repossessed if you do not keep up repayments on your mortgage.
What is a repayment mortgage?
A repayment mortgage, also known as a Capital and Interest mortgage or a capital repayment mortgage, is a mortgage contract under which the customer borrows for a fixed period of time and is obliged to make payments of interest and capital to the lender. These are designed to repay the mortgage over the mortgage period, as long as you keep up the payments.
What is an interest only mortgage?
With this type of mortgage you borrow for a fixed period of time, but the monthly payments to the lender only cover the interest charged on the loan. That means at the end of the term you must pay off the capital in one lump sum.
It is your responsibility to build up savings, usually through some form of repayment vehicle, so you have the money you need to repay the capital (the amount you borrowed) at the end of the term.
Your home may be repossessed if you do not keep up repayments on your mortgage.
What type of interest rate products are there?
There are a number of main schemes but new ones are being developed all the time but bear in mind that not all Lenders offer all schemes.
There are five main types:
- Variable Rate
Your mortgage payments to the lender go up and down as the interest rate changes (mortgage interest rates tend to move in line with a Base rate - usually the Bank of England)
- Base Rate Tracker
The interest rate varies (up or down) directly in line with the Bank of England base rate.
- Fixed Rate
The interest rate is guaranteed to stay at a set level for a set period, regardless of any changes in the base rate.
- Capped Rate
The interest rate varies but doesn’t go any higher than a set level, even if the base rate does go higher.
- Discounted Rate
Your payments are variable, but they are set at less than that lender’s standard variable rate for a period of time. At the end of the period, you are usually charged the lender’s standard variable rate.
What is a flexible mortgage?
Flexible mortgages are designed to allow you to make extra payments whenever you want to and benefit immediately. Some also let you reduce your payments or take a payment holiday.
What insurances are necessary?
There are many types of insurance you might need when you take out a mortgage. Everyone needs insurance to cover their home in case the building is damaged or destroyed, thus you can regard Buildings Insurance as compulsory. It is also adviseable to cover the contents against loss or damage.
There are Accident Sickness and Redundancy policies so that you can ensure that your mortgage payments are covered should you become ill or have an accident or become unemployed. Critical Illness or Life cover may also be part of your protection for the mortgage. We will recommend which policies and cover is most appropriate for you.
What are Current Account and Offset Mortgages?
CAM's and Offsets are pooling facilities, where you have your current accounts and savings with your mortgage lender. Your mortgage interest and monthly payments are then worked out based on your mortgage balance less the balances in your current and savings accounts. The higher your savings, the less you pay for your mortgage, although you do not receive interest on those savings.
Complete the No Obligation Enquiry Form below to get the ball rolling.
Think carefully before securing other debts against your home. Your home may be repossessed if you do not keep up repayments on your mortgage.