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125% Mortgage loan
It must be first stated that great care must be taken with these type of mortgage products as you are borrowing over and above the equity within the property. So changing circumstances can adversely effect your ability to service the loan. It must also be realised that although you may wish to consolidate unsecured debt for example credit cards and loans you will be placing unsecured debt on to a secured loan.A typical example might be where 95% of the mortgage consists of a secured loan on the property and the rest, the extra 30 % is an unsecured loan. The two amounts will normally be at the same rate which could be for example fixed or variable and both will run the same term. Some terms may stretch to 35 years long. The advantage of a long term is to be able to have lower monthly repayments providing the mortgage is capital and repayment. However the downside would be the large amount of interest you will be paying to a lender over 35 years Advantage : You may potentially purchase a home if you have no savings for a deposit and solicitors fees etc. Disadvantages : Higher interest rate Few lenders offer a such mortgages so choice is limited Not available as a Self Certification loan (self cert) Not available to clients who have an adverse credit rating (bad credit) Source: Free Articles from ArticlesFactory.com
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