Choosing the right mortgage deal

• Standard variable rate (SVR)
  With a standard variable rate mortgage, most borrowers are transferred to their lender's SVR once their initial, promotional rate period comes to an end. This is usually the most expensive of their lender's rates, and the rate from which many people choose to switch to a new product elsewhere.
• Fixed Rate
  A fixed rate mortgage charges a set rate of interest for a predetermined period, and then usually reverts to the lender's SVR. This kind of loan offers you the security of knowing how much you'll be repaying during the initial period, and can make budgeting much easier. But repayments may prove more expensive than a discount rate initially, and may also become uncompetitive later on, depending on how interest rates move over the period of the fixed rate.
• Capped rate
  A capped rate mortgage offers similar security to a fixed rate - since the rate you pay during the capped period won't exceed the capped rate - as well as the chance to benefit from any fall in mortgage rates within the capped period. However, the benefits of capped rate mortgages usually come at a price: rates are often higher than on lenders' comparable fixed products, and the initial term seldom lasts longer than two or three years.
• Discount rate
  A discount mortgage offers a reduction of a given amount on the lender's SVR and if this rate changes, the rate you pay will fluctuate in line with it. Usually, the shorter the discount period is, the greater the discount. After the discount finishes, the loan reverts in most cases to the lender's SVR.
• Tracker
  Tracker mortgages give borrowers the certainty of knowing the rate they pay will move automatically in line with Bank Base Rates. This allows the borrower to benefit straight away from any cuts in these rates, even if, as is often the case, the lender delays reducing its SVR to reflect the reduction. Many trackers also offer flexible terms.
• Cashback
  A cashback mortgage pays an upfront lump sum, thereby allowing a borrower to pay for, say, home furnishings or to repay credit card debts, or to put down a deposit. The rate paid is most often the lender's SVR.

All these are just shown as a guidline, for a full and detailed explination please fill out our form and get it in to us, or give us a call. 

Why remortgage?

In today's competitive market, many borrowers choose to switch their mortgage every few years in order to take advantage of the new rates on offer. Those that remain on the same deal for the full term of their loan could lose out on a range of potential benefits, not least the opportunity to reduce the total amount paid back, which could be a significant margin in some cases.

In simple terms, remortgaging involves switching your current mortgage to a new deal, arranged either with your existing lender or with a new lender. As a current homeowner you may want to consider taking this step for a number of reasons, such as:

• To save money
  If you're paying your lender's Standard Variable Rate (SVR), it's highly likely that your existing lender will offer a better rate and greater flexibility on other available products. This could allow you to save money on your monthly repayments, or to repay your mortgage sooner. And if your current lender doesn't offer better rates or greater flexibility on its other products, you may want to consider switching your mortgage to another lender, even if doing so would trigger early repayment charges payable to your existing lender, as this could still mean a net saving to you.
• To raise money
  Higher income or a rise in your property's value means you could increase your mortgage to help pay for major outgoings such as a wedding or your child's university costs, rather than borrowing separately, and in some cases more expensively, for the outgoing itself.
• To avoid moving home
  It can be cheaper and more convenient to adapt or add an extension to your existing home, paid for by remortgaging or a further advance, than to move home.
• To consolidate your debts
  Remortgaging can allow you to release some of the equity you hold in your home and consolidate other debts, such as a car loan or credit cards, which can attract higher rates of interest than that of your mortgage.

These are some of the things you should consider as an option, and here at Alpha Real Estates we can help make this a very easy transition.