RESIDENTIAL
There are many lenders and literally thousands of mortgage deals available to consumers. In the last few years however, the terms and criteria upon which mortgage lending is based have become ever stricter and more demanding, so our track record in residential mortgages is critically important.
The team at Calibre Capital has established and maintained key contacts with all the main high street and non-high street banks, as well as high net worth private banks. This means we have access direct to the decision makers. We know our way round these institutions, understand their decision-making criteria and the differing lending parameters that they set – and all this gives your application the best possible chance of success.
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The mortgage we arrange on your home will be subject to a number of factors such as interest rate options, repayment structure, term, percentage of borrowing against property value (commonly referred to as LTV, or loan to value). To help you towards a better understanding of the options, here are brief explanations of the key terms.
Repayment Structure
Interest Only Mortgage
Interest only borrowing differs in that the borrower commits to repay only the interest on the loan for the agreed term. This commitment is made on the basis that the loan amount is repaid at the end of the mortgage period. This type of borrowing has, quite rightly in our opinion, come under detailed scrutiny of lenders and the Financial Conduct Authority alike, and the result has been much stricter criteria throughout the mortgage process, to the point where a number of institutions have withdrawn interest only mortgages altogether.
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Nonetheless, interest only mortgages still have an important place in the market, and suit a certain profile of client and borrowing requirement. If interest only borrowing is suited to your circumstances, we are well placed in terms of experience and contacts to give you the right advice.
Capital and Interest Repayment Mortgage
A capital and interest repayment mortgage (commonly referred to simply as a repayment mortgage), is the preferred route of many of our customers. This structure will ensure that your borrowing is repaid in full at the end of the mortgage term, provided that all repayments have been made.
Interest Rate Options
Fixed Rate Mortgages
Fixed rate mortgages are exactly that! A fixed level of interest is agreed for a set period, which guarantees that your mortgage repayments will remain constant for the term of the fixed rate, making it easier to manage budgets.
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A fixed rate mortgage is an effective way of protecting yourself from changes in your lender’s standard variable rate, or external factors such as the Bank of England base rate. Two-year fixed rate products are very commonplace, while longer fixed terms are also available with typically three, five, and even 10-year rates being offered by the majority of lenders.
Discounted Mortgages
Discounted mortgages are, once again, a fairly straightforward concept. Essentially, the lender offers a discount (typically two to three years) from their standard variable rate, commonly known as SVR. Lenders set their SVRs at differing levels and pricing is at their discretion. For example SVR can be raised at any given time to any level, and not necessarily because of a change to the Bank of England base rate.
Tracker Mortgages
Tracker products simply track a designated index, with the Bank of England Base Rate being the most popular with lenders. A margin is set and can either rise or fall dependent on the movement of the base rate.