Mortgages

mort-gage | mor’Gidge

As possibly the biggest financial transaction of our lives we need to ensure any mortgage borrowing is affordable, will be repaid ‘on time’ and is protected along the way.

What are the risks?

Your home may be repossessed if you do not keep up repayments on your mortgage.

The day we receive the keys to our new home is undoubtedly a ‘high’ in life.  Our pleasure continues with the changes & improvements we make as we establish a secure base for our personal & family development.

Most people will need to borrow money via a mortgage to pay for the house and it is important that life’s pleasures aren’t spoilt by the worry of such debt.

The primary risk to avoid is over committing to a mortgage that at some point could become unaffordable and lead to worry & stress – not a good place to be for any of us.

Having a realistic plan to repay the debt is obviously important and will allow us to get on with enjoying life and our ownership of the property.

The other risks we might consider are all insurance related, including the risk of repayments becoming unaffordable due to death, illness or redundancy.  And other generally insured risks against fire, theft or damage to the property and contents.

Please be aware:

There are other providers of Payment Protection Insurance (Short Term Income Protection) and other products designed to protect you against loss of income.  For impartial information about insurance, please visit the website at www.moneyadviceservice.org.uk

The solution might include...

Working out a clear budget which includes both

The ‘fixed’ costs associated with running a household; and ‘Discretionary’ expenditure on the ‘stuff’ that makes life enjoyable

Be realistic!!

Consider some ‘What if?’ scenarios to make sure the mortgage remains affordable

Include in the budget having some spare to save for a ‘rainy’ day fund and longer term needs.

Things to consider...

What type of mortgage would best satisfy our needs . . . a ‘fixed’ rate, or a ‘discounted’?

Could our savings pot be used to ‘offset’ the cost of the mortgage?

Have we kept our insurance up to date with any increased borrowing?

Have we insured the contents for a realistic amount?  Being under insured could result in a claim payout being reduced in proportion.

The benefit…

…a lifetime’s pleasure in making a house a home (AND NOT a millstone around one’s neck)!

Our top tip...

The average loan to value for first-time buyers in England was 83% [1].

Source:

[1] The Council of Mortgage Lenders Survey – Key Industry Facts 2015.

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Contact us

Your home may be repossessed if you do not keep up repayments on your mortgage.

For mortgages we can be paid by commission, or for a fee of usually £875 or a combination of the two.

For general insurance we offer products from Legal & General*.

*If Legal & General cannot insure you for buildings & contents we may use a range of other providers.