Frequently Asked Questions
Answers To All Your Questions
What is a mortgage?
Simply put, a mortgage is a loan that is secured against a property.
The definition of a mortgage is a legal agreement by which a bank or lender lends money with interest, in exchange for taking the title of the debtors property. This is on the condition that the conveyance of title becomes void upon the payment of the debt.
What is the difference between a mortgage and a remortgage?
A mortgage is used to help fund the initial purchase of a property, while a remortgage is the refinance of an existing mortgage on a property.
Why do people remortgage?
There are two main reasons for remortgaging and they are:
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To reduce mortgage repayments
Your home is most likely to be the largest investment you will ever make so it makes sense to ensure that you repay the finance on this investment for the lowest total cost possible.
One of the ways of ensuring that you repay the mortgage at the lowest total cost is to regularly review the terms of your mortgage, especially if you are on the lender’s standard variable rate, or if you are coming to the end of an existing deal.
You can then either speak directly with your lender to see what other terms they have available that you will qualify for, or speak with an whole of market adviser who can compare products from across the market for you and let you know what you qualify for taking into account all of your circumstances.
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To raise capital
If you have equity in your property, it may be possible for you to use this equity to raise capital from your property.
In essence, you can raise money from your property to use for any legal purpose. Every lender has their own criteria for raising capital raising.
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THINK CAREFULLY BEFORE SECURING OTHER DEBTS AGAINST YOUR HOME. YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE.
Are there limits to how much a mortgage lender will lend?
Yes.
In addition to affordability checks, all lenders will have both a minimum and a maximum loan amount that they will lend. These amounts may vary depending according to the Loan to Value, typically, the more equity there is in a property, the higher the maximum loan amount they will lend.
How long can I borrow the mortgage for?
All lenders will have a minimum and maximum available term limits for lending. This can be anywhere between 1 year as a minimum and 40 years as a maximum.
The maximum term available to you will also be subject to your age and anticipated retirement age.
Can I get a mortgage beyond my retirement age?
Yes.
There are some lenders who will lend beyond your anticipated retirement age, however, you will need to be able to demonstrate how you will be able to continue to afford the mortgage beyond this age for example from Pension income.