A mortgage is a loan which is used to buy a property and this kind of lending has two main features. Firstly, you will be paying this back over a long period. Subsequently, a mortgage is 'secured', which means the bank uses your property as security your money can buy lent.
If you cannot make repayments on your house, the bank has got the right to repossess your home to cover the money borrowed. From the unfortunate circumstances where your house may be repossessed, the money that the financial institution gets from the sale of your home may very well not cover the original amount you borrowed. That is why you should ensure you'll be able to afford the property under consideration. You can also checkout mortgage guide at ritemortgages.
Mortgages tend to vary immensely and the thought that one is similar to the next is cannot be entirely true. You should carefully consider your overall and future financial situation to best gauge the amount of to borrow and how you want to pay it back.
A common mortgage advice question: – A pursuit only mortgage, or a new repayment mortgage?
Interest only mortgages – this sort of mortgage repayment, won't actually pay off any of the money you have borrowed, as its title states you're only paying off the interest.
Repayment mortgages -this is seen as a much more appealing way to paying off your mortgage loan. Your monthly payments are not going to cover your interest, but will also pay off a number of the money you have borrowed.