Best Type of Mortgage

Knowing which is the best type of mortgage for your needs is never easy, do you fix it , take a flexible mortgage , take a tracker/discount or link your current account to the mortgage. How do you decide?

Take a minute to read our quick guides to the best type of mortgage. The simple questions below are the kind of questions an adviosr would be asking. Ceck out the statement that best meets your needs and read our simple guide you to the advantages and disadvantages of that type of mortgage.

Do you want to the stability of your interest rate not rising?

Fixed Rate Mortgage with ERC

A Fixed Rate with an early repayment charge ( ERC ) could be right for you.

With a fixed rate mortgage the monthly repayment amount is fixed for a specified period irrespective of changes to the Bank of England's base rate or the lenders standard variable rate.

Advantages and Disadvantages of a fixed rate mortgage with erc

Advantages

  • Peace of mind that your mortgage payment will be safe guarded against increases in the lenders standard variable rate during the fixed rate period.

Disadvantages

  • You will normally have to pay an application fee when arranging your fixed rate mortgage.
  • Early redemption penalties can be onerous and expensive.
  • If the fixed rate has an extended erc period it could mean you paying a higher rate once the fixed rate has ended.

Fixed Rate Mortgages Information and Best Buys

Go Direct have guides on all the mortgage interest rate types and fixed rate Types of Mortgage best fixed rate buy tables to help you.

Do you want to take advantage of rates going down?

Discount Rate Mortgage with ERC

A Tracker/ Discount Rate with an early repayment charges( ERC ) could be right for you.

A tracker/discount mortgage has an interest rate where a discount is applied to the lenders standard variable rate or Bank of England base rate for a set period.

Advantages and Disadvantages of a Discount Rate Mortgage with ERC

Advantages

  • Lower interest rate in the discounted period
  • Your mortgage payment will reduce when there is a fall in the lenders standard variable rate or Bank of England base rate
  • Lower interest rate than the comparative discounted/track rate with no erc

Disadvantages

  • You may have to pay an application fee when arranging your discounted/tracker rate mortgage
  • No stability when compared to a Fixed rate mortgage

Tracker Rate Mortgages Information and Best Buys

Go Direct have guides on all the mortgage interest rate types and fixed rate Best tracker rate buy to help you.

Would you like to change your mortgage to suit your circumstances?

Flexible Mortgage

A flexible mortgage could be right for you as it allows you to change your payments to suit your circumstances as the ups and downs of life affect you ability to pay the monthly payments.

Flexible mortgages allow you to overpay and underpay without redemption penalties being charged. You can tailor you current financial situation to the mortgage payments that you make. When you have spare cash you can overpay and if necessary you can underpay, skip a payment or even borrow money against the capital repaid.

Advantages and Disadvantages of a flexible rate mortgage

Advantages

  • You can pay off your mortgage early, without penalty, by making overpayment.
  • You can borrow against mortgage overpayment or equity in the property more easily, and at a lower interest rate than a 'standard' loan. (dependent on the type of flexible mortgage)
  • You are able to change mortgage at any time without being penalized as there are no early redemption penalties.

Disadvantages

  • Making too many underpayments could result in extending the mortgage repayment period.
  • No stability when compared to a Fixed rate mortgage

Flexible Rate Mortgages Information and Best Buys

Go Direct have guides on all the mortgage interest rate types and fixed rate flexible rate best buys to help you.

Do you want to link your savings or bank account to your mortgage debt?

Offset Mortgage

An offset mortgage could be right for you as you can link savings and banking to your new mortgage.

Offset mortgages allows you to put all your money in one place - from your mortgage and loans to your savings and current account, giving you the flexibility to live your life differently.

Advantages and Disadvantages of an offset mortgage

Advantages

  • you pay a single low interest rate on everything you borrow your mortgage, loans and credit cards
  • you get a great return on your savings and the money that normally sits idle in your current account - with no tax to pay
  • you get complete flexibility on how much you pay on your mortgage each month you always have complete access to all your money

Disadvantages

  • No stability when compared to a Fixed rate mortgage
  • Interest rates are often high than a discounted rate.

Offset Mortgage Information and Best Buys

Go Direct have guides on all the mortgage interest rate types and fixed rate offset mortgage best buys to help you.

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


Do you want No Fee Mortgage Advice?

If you would like to discuss mortgage or remortgage schemes with a professional mortgage advisor please complete our mortgage advice form and an mortgage advisor will contact you to discuss your mortgage requirements. We normally do not charge a fee for mortgage advice, however this is dependent on your circumstances such as complex cases or debt consolidation. Our typical fee would be £399.