The Basic Facts

A mortgage is a loan you take out to buy property, or sometimes land: what you owe is secured against your property until you’ve paid off the outstanding sum. If you end up in a situation where you can’t pay back the loan, the body issuing your mortgage is entitled to repossess your home or land. Bearing this in mind, you can see why it’s vital to keep up with the repayment schedule of any mortgage you take out.

Which Mortgage Repayment Scheme Will You Choose?

It’s helpful to view your mortgage as consisting of two elements: the capital, which is the sum you originally borrow, and the interest, which is a charge levied by your mortgage lender. The interest charged is usually calculated as a percentage of the overall sum owed. When it comes to working out the best way to repay your mortgage, you can choose from two different schemes.

What’s The Right Kind of Mortgage For Your Circumstances?

Once you’ve made a decision about whether you’d like an interest-only or repayment mortgage, you need to decide what kind of mortgage best suits your circumstances. Though the large choice of mortgage products on the market is confusing, it essentially represents variations on three themes.

When you choose a fixed rate mortgage, you’ll know in advance exactly how much you need to repay each month, whereas with a variable rate mortgage your monthly repayments will fluctuate according to the Bank of England’s bank rate. Finally, if you opt for a flexible mortgage, you can vary the size of the instalments you pay to suit your finances, and sometimes even take a break from payments altogether.

Beside you all the way

At Zing, we’re here to help you throughout your mortgage application. From your first enquiry through to completion - we’re here to make the whole process easier for you.

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