anyone here able to enlighten me? looking into getting a property for the first time and i don't have clue how anything works. i'd ask my dad but i wasn't even born the last time he applied for a mortgage so he can't remember.

 

Yas

Go to your Bank, they'll help. Ditto any Estate Agent. Or try Google, there's loads of info about. If you honestly think that YOU would lend YOU money, then you should have no trouble.

ww.moneysavingexpert.com has an excellent section on mortgages.

 

Also look out for the redemption penalites - the amount you pay if you want to 'get out' of the mortgage before the agreed period (usually 2-5 years) is up.

 

Beware the fees too - £500-£1000 doesn't sound much when you're talking tens or hundreds of thousands - but most mortgages go back to the base rate after 2-5 years and you generally then need to swop to another mortgage - and pay the fees again.

 

 

My advice is get a variable rate one - fixed ones generally cost a bit more - the banks know when the interest rates will go up. Yes you get peace of mind but you pay for the privelege. The interest rate will probably go up 0.25% twice in the next 6 months-a year.

 

And don't be tempted by all the extra insurance they sell with it - critical illness, redundancy, life cover etc - if you read the small print they don't pay out for long if you do claim and they're INCREDIBLY EXPENSIVE. If you do want them, you can probably get them cheaper elsewhere.

 

We've just got a new mortgage for a new house and we're with Abbey National, tracking just below the bank of england basae rate at 4.64% - we had quite a big deposit though which helped.

 

We also took it over 22 years rather than 25 - the shorter the term, the more you pay each month but you pay A LOT less interest overall.

 

If you want to work out payments depending on how much you borrow etc, try this mortgate calculator:

http://www.bbc.co.uk/homes/property/mortgagecalculator.shtml

 

Don't worry - interest rates won't reach 12%!

Find yourself an independant financial adviser and walk away if they charge, they get a finders fee from the mortgage lender so don't need to charge a client to make money.

Yaseen,

 

drop me a PM and we can have a chat, I am an independent financial adviser and independent mortgage adviser.

 

Cheers, Mike...