What types of mortgages are there?

Mortgages are loans used to purchase or refinance a property. There are several different types of mortgages available in the UK, including:

Fixed rate mortgage: This type of mortgage has a set interest rate for a specified period of time, typically 1-5 years. The interest rate will not change during this time, providing the borrower with a predictable monthly payment.
Tracker mortgage: This type of mortgage has an interest rate that is linked to the Bank of England base rate. As the base rate changes, so will the interest rate on the tracker mortgage.
Discount mortgage: This type of mortgage offers a discounted interest rate for a specified period of time, typically 1-2 years. After this time, the interest rate will revert to the lender’s standard variable rate.
Capped mortgage: This type of mortgage has a cap on the interest rate, meaning that even if interest rates rise, the borrower’s rate will not exceed the cap.

Offset mortgage: This type of mortgage allows the borrower to offset their savings against the mortgage, reducing the amount of interest paid on the mortgage.
Flexible mortgage: This type of mortgage allows the borrower to make overpayments, underpayments or take payment holidays, providing greater flexibility in managing their mortgage.
Standard variable-rate (‘SVR’) mortgage: This type of mortgage has an interest rate that is set by the lender, and can change at any time.
Interest only mortgage: This type of mortgage requires the borrower to only pay the interest on the loan, rather than repaying any capital.
Repayment (capital and interest) mortgage: This type of mortgage requires the borrower to repay both the interest and the capital on the loan each month.
Part-and-part mortgage: This type of mortgage is a combination of an interest only mortgage and a repayment (capital and interest) mortgage.
Patrick Wayne Wealth can help clients understand the different types of mortgages available, and guide them in choosing the best mortgage for their needs and circumstances. Whether you are a first-time buyer, looking to remortgage, or looking for a buy-to-let mortgage, Patrick Wayne Wealth has the experience and knowledge to help. It’s not just about getting the right mortgage, but about ensuring that the mortgage is affordable and sustainable in the long term.

Please note your home may be repossessed if you do not keep up repayments on your mortgage

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