It can be easy to be blinded by low rates of interest when looking for a mortgage. However you have to also take the time to compare the small print as this is where additional costs can be found and there can be many. All of these will add to the cost of your mortgage and so must be considered.
The easiest way to compare mortgages is with a specialist website. A specialist website will allow you to gather together and compare the rates of interest for mortgages and should also present you with the key facts of the mortgage. You have to consider and compare the whole package of the mortgage to be able to decide which the best mortgage will be.
There are different types of mortgage to choose from. The fixed rate mortgage is based on taking out a mortgage for a number of years at a fixed rate. This is excellent if the rate of interest is low and you can afford to repay the loan back in the short term. The downside to the fixed rated is that after the pre-defined time the rates can jump up alarmingly. Another downside is that if the rate of interest should drop then you are stuck with a higher rate.
The variable rate mortgage will usually come with a lower rate of interest but this will vary. This means that you do not really know what the monthly mortgage repayments might reach. However you can benefit if the rate of interest were to drop and can be a good way of mortgaging in the short term.
However it is not just the rate of interest that you have to take into account. There can be hidden fees attached to the mortgage that can boost up the cost. These can vary in how much they are and what is included. Some of the most common costs include arraignment fees, redemption and valuation costs. However by searching around online and comparing you can get fee free mortgage due to the competition that is around.
The valuation fee is a fee which is charged when the lender wants a valuation of your home so they can be sure that your home is worth the amount you are asking to borrow. This is a way of the lender protecting themselves in case you should default on the loan.
The arraignment fee is the fee to cover the cost of the lender arraigning your mortgage. This is sometimes called the set up costs and the amount that is charged can vary considerably, so it is essential that you check how much the set up fee is.
As you can see getting the best mortgage is not all about just the rate of interest that comes with the mortgage. It is essential that you consider the added fees because all of these go towards how much you will pay for your mortgage.
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By: Joshua Conway