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Finding the Best Mortgage

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As the recession continues to bite, many people are increasingly investigating means of accessing finance in a manner that is cost-effective, quick and financially beneficial.  Today, people are constantly bombarded with advertising that shows them how to do this, and it can be difficult to make an informed choice in the wake of such competition. However, recent consumer and finance based studies have revealed that mortgages which offer additional benefits such as cash back and complementary legal advice can often provide a much more cost effective solution, than offers which have minimal interest rates.

Cash Back Mortgages

Cash back with a mortgage can provide a swift cash injection to a person’s finances- and generally ranges between £150 and £1500. It is popular with its recipients as it is generally seamlessly deposited into a borrower’s account as soon as the mortgage is completed- enabling the customer to reap the benefits of the financial product immediately.

As a consequence of the economic downturn, competition between financial institutions has reached, “fever pitch”, with regards to lending money to people experiencing or anticipating impending financial challenges. However, whist on the face of it, the majority of products on offer to the general public may seem fairly generic, and all bound by similar terms and conditions, it is always essential to undertake research before committing to mortgages and other means of accessing finance.

Finding the Best MortgageCheck the rates and then double check them

For example, Norwich & Peterborough offers a two-year fixed-rate deal at 2.24 per cent which is is 0.5 per cent more expensive than Chelsea BS’s popular 1.74 per cent. However despite this, customers attempting to secure  a £150,000 loan on a property that is valued at £250,000 will discover that N&P’s free items result in the higher interest rate being considerably lower.

When broken down further, it can be calculated that the monthly repayments on N&P’s £150,000 product are £653.45, a significant £36.45 a month more than Chelsea’s deal- which represents a huge chunk of money when it is repaid over the life of the product. For example- annual repayments will add £437.40 to expenditures when compared to the Norwich and Peterborough product, so it always worthwhile taking a long-term view.

Beware: Mortgage fee increase while rates remain low

It is also prudent to consider that whilst interest rates have declined in recent months, mortgage fees themselves have risen considerably. Recently, consumer finance specialists- Moneyfacts have revealed that fees on a five-year fixed rate product with a standard deposit of 25% have risen by more than 30% since the beginning of the year.

Compare Mortgages

Due to the increased mortgage fees it as important as ever to consider all aspects of mortgages before purchasing them, as the accumulation of unforeseen fees can make for an unpleasant surprise. Whilst this may seem like, and often is an incredibly tedious process, many financial websites have mortgage and loan calculators and comparison resources that can allow you to access key financial information effortlessly. Or speak to an independent mortgage broker. This will help you to make the most informed decisions on regarding how to deal with current financial obligations, and save you from experiencing problems in the future.

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About Miles Matthews

About Miles Matthews

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