Buying a house can be both scary and exciting, especially for the first time buyer. So here is a comprehensive guide to home loans for the first time buyer: Taking out a mortgage to buy a home is effectively having a loan, which is off-set against your property. When you take out a mortgage you enter a contract with a bank and are responsible for repayments, although some companies offer policies which agree to let you take a break from your instalments if you have a change of circumstances. Interest rates on loans can be confusing. However when shopping around for a mortgage you should remember that you want a high interest rate for savings and low rates for mortgages or borrowing. Remember, when looking at interest rates for mortgages, that variable interest rates many change to keep in line with the economy. This means that you could find your interest rates increase; this will also mean that your monthly repayments will rise accordingly. You should have a clear idea of how much you can afford to borrow. You should be aware that a mortgage is in place for a long period of time and that your circumstances may change. Try and consider likely future events, it is a bad idea to borrow the maximum amount that the bank offers you as you may have difficulty keeping up with your monthly repayments in the future. When you take out a mortgage, you do not have to stay with the same lender for the whole term of the loan. You may be able to transfer to a different lender and save some money, but make sure that this is allowed within your mortgage contract, as some tie you in for the whole term and will charge a fee to switch. Taking out a mortgage is something that you need to consider at long length, so make sure you get advice from your lender and independent bodies. You should always factor in for unseen costs, like a new boiler or other household expenses. If you are entering into the mortgage with another person you should make sure that there is a contract in place just in case someone leaves before the mortgage has been paid off.
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A First Time Buyer's Guide to Mortgages
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