The largest and most important investment most people make in their lives is when they decide to buy the property where they want to live. Choosing how to buy property can be a challenge, with a vast range of options open to the potential or existing homeowner.
Property prices and interest rates are an important factor to consider when looking to buy a new home. The potential homebuyer also needs to consider where they want to live, in what type of property and ensure they are paying the right price for their flat or house. Interest rates will dictate the amount of money that will be repaid to the mortgage lender. Currently interest rates are low (the lowest rate for c30 years) which encourages the borrower to have a larger mortgage, but for how long will this period of low interest last?
The most common way to buy property is by taking out a mortgage. There is a wide choice of mortgages available designed to suit the personal circumstances of the homeowner. There are several mortgage types available including standard variable rate mortgage, discounted rate mortgage, fixed rate, buy-to-let, self-certified mortgage and 100% mortgages. Specialist mortgage lenders are also able to provide finance for self-build mortgages, right to buy mortgages and overseas mortgages.
Mortgage providers underwrite applicants for credit worthiness and will often take into account several factors when granting a loan including; income, employment status and the price of the property. The mortgage provider will also ask the applicant to prove an ability to pay for the mortgage, which may have implications for the self employed
