Thursday, October 21, 2010

The Difference Between Remortgages And Mortgages.

By Paul Menzies

The majority of the population people have heard the expressions remortgages and mortgages but are just not sure what the words actually mean

A mortgage is a loan needed to purchase property, and when buying property most need a remortgage unless they have a healthy bank balance or a wealthy father, and not many are as lucky as this.

Half the population of the UK are homeowners and so during a life time most will have had at least one mortgage and because many move house every few years the average person will have had five or more mortgages in their life.

You can get mortgages by going direct to a bank or building society or you can arrange it through a mortgage broker.

A mortgage broker is by the best means for people wanting a mortgage as the broker deals with the whole of the market , and can provide you with a vast choice of mortgages, compared to going to only one mortgage provider who will only offer you their own products, and therefore it can all end up costing you a lot of money

Fixed rate mortgages and trackers are the two most common sorts of mortgages and again a mortgage broker is best placed to go over all this with you.

What a tracker does is it tracks the Bank of England Base lending Rate and the repayment will go up when the base rate changes.

Fixed rates do not change during the fixed rate term

Remortgage are when a homeowner changes his current mortgage from one mortgage provider to a new one and this is done to obtain lower repayments with a better interest rate.

Remortgage in every other aspect act the same as mortgages that already exists on the property with identical interest rates as well as tracker and fixed rate remortgages on offer. - 42535

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