Mortgage Advice

Mortgage Advice

The mortgage market is a jungle.

Whether these are good times or bad times, whether rates are high or low, whether lenders are keen to lend or trying to discourage you, the fact is you need to speak with an independent adviser who offers advice across the whole of the market.

Put it another way, is there any point in approaching somebody who cannot offer this service? Will the Woolwich tell you that the Abbey has a good fixed rate?

Highclere advises on mortgages, re-mortgages, buy-to-let mortgages and equity release products. Please note that Buy-to-Let mortgages are not regulated by the Financial Services Authority.

Highclere has been awarded the Money Management Mortgage Planner of the Year award on three separate occasions – the only company to have achieved this.

Types of Mortgage

Fixed Rate
The interest rate is fixed for a period between two and twenty five years. This means that the monthly mortgage repayments will not increase or decrease. This type of mortgage is particularly suitable for those who cannot take the chance that interest rates and therefore monthly payments will rise.

Capped Rate
With these the rate cannot increase but, if interest rates fall, it can decrease. Capped rates cost slightly more than fixed rates and for this reason they are only recommended when it appears that rates might fall.

Tracker Rate
The interest rate is linked to the Bank of England base rate. An example would be BoE + 1.25% which means that for an agreed period the interest rate will be 1.25% higher than the Bank of England base rate.

Discounted Rate
This is somewhat similar to a Tracker Rate, the difference being that it is linked to the mortgage lenders own base rate. They are generally considered to be less attractive than Tracker mortgages because the mortgage lender controls the base rate and can delay rate falls to its own advantage.

Variable Base Rate
It is relatively uncommon these days but some borrowers opt for the lenders base rate. One reason might be that these rates do not normally have early repayment penalties.

LIBOR Linked Rate
Many borrowers unfortunate enough to fall into arrears or receive County Court Judgements or bankruptcy will find that the only loans available are linked to LIBOR. LIBOR stands for London Interbank Offered Rate and this is the rate at which banks lend to each other. A typical LIBOR loan might be LIBOR plus 4.50%. LIBOR rates normally change every three months.

There are other types of mortgage available such as current account and offset mortgages. Buy-to-Let and fast-track mortgages.

Recent Posts

Protect your family

How many people actually know what financial state their family will be in if the breadwinner dies unexpectedly?

This is even more pertinent if there are dependent children.

What is not widely known is that an inexpensive insurance called a family protection plan can take this risk away.

This insurance could not be simpler. You select a time period, say 20 years, and if you die within this period the plan pays a tax-free income to the spouse/partner for the remainder of the term.

The example below illustrates this perfectly.

Mr & Mrs Lumpkin are aged 35 and 29 and both are non-smokers. They have two children ages 3 and 7. The Lumpkin’s want to ensure that if one of them dies then the survivor receives a worthwhile income until the youngest child is age 21 (and presumably no longer dependent).

They believe that £1,250 p.m. is adequate.

Mr Lumpkin can obtain such a plan for £9.55 p.m. whilst Mrs Lumpkin pays £7.66 because she is younger.

So, for a combined £17.21 they can provide each other and their family with the financial security we all desire.

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