What are mortgage rates?
When purchasing a property, a homeowner can opt for either a fixed rate mortgage or variable interest rate mortgage. Either of which will impact how much your mortgage payments will cost, alongside what the terms and conditions of your mortgage lender are.
If you’re a first time buyer or looking to move home, it can be overwhelming to get your head around the different payment plans. Here at Financial Foresight we can offer advice and guidance to help you decide which mortgage rates are best suited to your personal needs.
1. Fixed Rate
Mortgages with fixed rates means your payments costs are locked down and will not change during your term. Fixed rates can provide stability for home owners and make budgeting easier. However, they do not offer as much flexibility as mortgage rates.
Commonly, mortgage lenders will offer a fixed rate for a short period e.g. two years, and then move across to a variable interest rate. This can provide homeowners with the opportunity to review their existing payment plan and consider remortgaging.
2. Variable Interest Rate
Variable Rates are linked to the current prime rate, which means your mortgage rates can fluctuate during your mortgage term. A homeowner opting for this type of mortgage should be prepared to take some risk! You can potentially pay off your mortgage faster but be prepared to pay extra if prime rates increase!
Buying a property can be one of the most expensive investments in a person’s life. Which is why it’s vital to seek expert mortgage advice from Financial Foresight to get the best deal available to you.
If you would like further advice feel free to book a free, no obligation mortgage consultation with Financial Foresight today. Our expert advisors will be more than happy to offer trusted mortgage advice.