Fixed Rate Mortgages

If you want the financial security of knowing that your monthly mortgage payments will always remain the same then you should look into a Fixed Rate Mortgage. It will give you the ability to plan your monthly finances around your monthly mortgage repayments. Fixed Rate Mortgages are the right kind of product for you if you worry about mortgage rates increasing. They will be able to provide you with the security throughout the term of the Fixed Rate that the rate offered would never change and your monthly payments will remain the same through the duration of the fixed period.

Fixed Rate Mortgages can be purchased for a two-year period up to a ten-year period depending on the lenders individual product. The mortgage rate is always set around the Bank of England base rate. If there are any changes to the Bank of England base rate, the Fixed Rate will not be subject to any change during the course of the agreed Fixed Rate period.

Mortgage applications can be made by prospective homeowners who are aged 18 years or above. Prospective applicants can visit their current lender who will be happy to provide financial advice on their current Fixed Rate Mortgage deals. Alternatively, other high street lenders or specialised lenders through the internet can also offer Fixed Rate Mortgage advice. If you are a first time buyer or someone who is returning to the Mortgage market, the amount of information on offer can be very confusing and it’s worth considering making an appointment with lenders financial advisors to discuss all the options available and all the relevant documents required for application. If further assistance is required, an Independent Financial Advisor can be contacted as well as a mortgage broker to seek advice on all Fixed Rate Mortgages available. It’s worth shopping around to gain the best deal on offer as you could be losing out on a better deal if you stay with the same lender at all times.

Interest Rates on Fixed Rate Mortgages will be set as an “Annual Percentage Rate” (APR). The APR will be fixed for a certain period which will be agreed between the borrower and the lender. Sometimes, the lender will charge a fee for their Fixed Rate product which enables you to lock in to the relevant product for a number of years. After a fixed Rate Mortgage period has ended, borrowers revert back to the lenders variable rate but will have the option to apply for another fixed rate mortgage product with their existing lender or an alternative lender offering a better deal. You should be aware that should you repay the mortgage earlier than anticipated, you could be subject to early repayment penalties. The lender can impose penalties on you such as charging you two months worth of mortgage interest should you repay the loan early.

Most lenders now accept Internet applications for Fixed Rate Mortgages. The lender that you have made your application to for the Fixed Rate Mortgage will assess your financial background using a credit scoring system. This is where the lender will assess the potential risk associated with lending you the money for the mortgage. The credit check will be look at factors such as employment history, monthly expenditure and current debt. The value of your home will also have to assessed by the lender to ensure that the loan is compatible with the value of your property. This also allows them to see if there is any great risk in approving the loan on the property that you have agreed to mortgage.

If your mortgage application is successful and you are approved to borrow the loan, the borrowed funds can usually be transferred within a two-week timescale. The completion of the mortgage will usually take place through a solicitor where they will receive the funds from the bank to be paid onto the vendors’ solicitor for the property.