What We Do

Mortgages

Choosing a mortgage – where to start

With hundreds of mortgage deals on the market, it can be hard to know where to start. If you are wondering whether to choose an interest-only mortgage, or a repayment mortgage, want to know how long your mortgage will last, and what happens if you want to move house or change your mortgage lender, contact Quigley & Partners Ltd.

We are authorised by the Financial Conduct Authority (FCA) to offer market brokerage services and will provide everything you need to purchase or refinance your desired property. We can not only explain the mortgage process from start to finish, but will source the most appropriate mortgage based on your needs, apply for a mortgage on your behalf and will take any other financial planning needs into account.

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What is a mortgage?

A mortgage is a loan you take out to buy property. You borrow a certain amount of money and will have to pay it back with interest over a period of time. What is unique about a mortgage, however, is that it is secured against your property, which means that if you cannot pay it back, the lender can repossess and sell your property to recover their money. You can get a mortgage from most banks and building societies, as well as specialist mortgage lending companies.

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What to Consider Before Getting a Mortgage?

As a mortgage is a long-term financial commitment, it is recommended that you shop around, and consider some key points before finalising your decision.

Choose a mortgage type that suits your financial resources and income and personal circumstances.
Do not borrow more than you can afford.
Do not ignore the possibility of future changes – interest rates can go up, you can lose your income, or fall ill.
You will have to calculate how much you'll have to pay each month, consider the interest-rate type, and any special features you might need.
You might also wish to change lenders for various reasons, for example to reduce the size of your repayments, or to pay off your mortgage earlier, through the process of remortgaging.
Mortgage and Repayment Types

Once you get a mortgage, you can choose to repay it in certain ways, depending on your financial situation. The two basic options are repayment and interest-only, or you can choose a combination of the two.

1. Repayment Mortgages – If you choose a repayment mortgage, your monthly payments will consist of repaying the amount borrowed as well as the interest. The advantage of this repayment method is that it's a simple approach, and you'll be paying off a part of your mortgage every month.

2. Interest-only mortgages – If you choose an interest-only mortgage, your monthly repayments will only cover the interest on your loan. The advantage of this kind of repayment method, is that you will be paying less per month than you would pay with a repayment mortgage. On the other hand, the total cost of your interest-only mortgage can be higher than a repayment mortgage, and it is not guaranteed that loan will be paid back by the end of the term. If you cannot repay the loan at the end of the term, you could lose your property.

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Interest Rates

Once you've chosen the repayment method, you will also have to choose an interest-rate deal.

A fixed interest rate is set at a certain level for an agreed time period, and can give you the security that you will be able to afford the repayments.
A standard variable rate means that your repayments may either go up or down, as set out by your lender, which might also be influenced by the Bank of England interest rate.
A capped rate means that your repayments are variable, but will not go above a certain level.

In general, if your interest rate is not fixed, the Bank of England's interest rate may affect your lender's rate, either increasing or decreasing it. As there are many types of interest rate deals and repayment options, it is always important to take your financial situation and possible future circumstances into account to make an informed decision and to be able to afford your monthly repayments.

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Insurance

A lender may require you to take out life insurance to pay off your mortgage should you die or be diagnosed with a critical illness, known as Mortgage Protection cover. You can also get insurance to protect your income or just your mortgage payments if you become ill or disabled, or lose your job, known as Income Protection or Mortgage Payment Protection. As independent financial advisers, we can advise you on the most appropriate cover for you from the wide variety available.

If you need financial advice, contact Quigley & Partners Ltd, as we are fully qualified to assess your specific needs and help you to decide on the most appropriate repayment method and to make recommendations for interest rate deals. Whether you are borrowing for the first time or changing lender, Quigley & Partners can guide you through the whole mortgage process.