endowment mortgage, second mortgage uk

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If the plan is not reaching its expected target, the borrower can increase payments into the policy or invest in another product to cover any anticipated shortfall

For example; It may be that the property is located on the local pub route and returning merry singers (or worse) could end up becoming a nuisance

Title Deeds Title Deeds consist of a pack of legal documents, which a lender holds for the duration of the mortgage as security against the loan. The documents include who owns the legal title to the property and land, the results of solicitors’ searches and a map of the property with the legal boundaries defined.

Tracker Mortgage A Tracker Mortgage is linked to a benchmark interest rate, such as the Bank of England base rate. This is usually only for a set period of time. The rate you pay moves up and down in line with the benchmark selected. At the end of the set period, the Standard Variable Rate normally applies

Overpayments and lump sum payments into your mortgage account can be made reducing both the interest and capital amounts repayable

They are also useful for larger amounts or where the applicant requires a longer repayment period

Ask why the current owners are selling the property

Other Benefits A whole range of other benefits can be applied to mortgages including the significant benefits of no Mortgage Indemnity Charge and no Early Redemption Charge

Legal Fees It is necessary to have a solicitor or licensed conveyancer to act on behalf of the mortgage applicant and the lender in the house purchase or remortgage transaction

Choosing the correct survey Choosing the correct survey depends on the requirements of the lender and the property itself

You only get this if you qualify for income support

The amounts can range from a flat fee e

Basically it is any item that is not firmly attached to the house that is counted as a moveable

It is still possible to have up-front charges for discounted products and an Early Redemption Charge is common

If for any reason your application is declined, may be able to direct your application to a provider who can help

Lockout agreements and contract races Preferable at the time of offer try to ensure that the agent and the seller agrees that higher offers will not be entertained (gazumping)

Buy To Let Mortgage Buy To Let mortgages are taken out to buy a property for the sole purpose of letting as an investment.

damp and timber reports, planning consents for alterations and extensions

Lenders have been known to charge a switching fee even if you refused to accept the lenders insurance cover at the time of taking out a mortgage

This method is designed to give you the opportunity to generate a cash sum sufficient to repay the outstanding mortgage capital at the end of the agreed term

You are not looking for a guarantee of repayment at the end of the mortgage term

Popular in the late eighties and the nineties an endowment policy is a combination of two basic elements, namely a savings plan and a life assurance policy

First time buyers looking for security during the first few years of setting up home

Sealing Fee This is a fee charged by all lenders for discharging a mortgage when it is repaid in full Searches A buyer’s solicitor normally carries out searches. The solicitor will carry out local searches on your behalf to make sure that the property you are planning to buy does not have, for example, a road planned at the bottom of your garden or any compulsory purchase orders attached to it. This is usually done by a search of the local land register. Your solicitor sends a standard form to the local authority that will enter details of any local land charges adjacent to the property you are buying. The speed with which the results are returned varies considerably from borough to borough. You can speed up the process by arranging a personal search. You pay a fee, whereby a search agent, appointed by your solicitor, calls at the offices of the local authority and the search is conducted there and then. This is not an official search, so will not protect you to the same degree, but if speed is of the essence, it can save weeks.

Unit Linked – Once again investors funds are pooled and then used to purchase units in stock market linked investments

As a consequence of not being ‘locked-in’, the rate offered on these schemes will usually not be as competitive as for mortgages with redemption penalties, making them most suitable for those who are likely to keep track of current rates and wish to remortgage quickly if they find a better rate, or those who may have to repay their loan in the first few years

Generally this cost is being phased out in the market but you may still encounter this premium for loans above 80% of the house value

Advantages: Complete flexibility within the mortgage market allowing option to move from lender to lender should the opportunity to take advantage of more competitive rates elsewhere arise

They are not available for business purposes and some other uses may also be excluded, for example the purchase of timeshare properties

They are also generally linked to variable rates and so reductions in your mortgage payments in the early years may not be possible with this type of product

Once contracts have been exchanged, bankruptcy searches on both the buyer and the seller will be carried out

The borrower also takes out at the same time, an alternative ‘repayment vehicle’ (method of paying off the mortgage) such as an ISA, pension plan or endowment policy

Generally anything between 1 and 25 year fixed rates are available

Valuations and mortgage reports Note, a valuation is not a survey

Ask about the sellers position