what mortgage can i afford

100 Percent Mortgages

Many people do not have the money for a down payment, but still desire to buy a home. A lot of people are unable to come up with the 5% – 20% down payment that is often required to purchase a home. In this situation, a person might think of applying for a 100% mortgage loan. You can borrow all of the money needed to buy a new home and not have to come up with a down payment if you qualify for a 100% mortgage. Generally, a person needs good credit to take out this type of loan, but it doesn’t have to be perfect.

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Pay Off Mortgage Early

Given the opportunity, it may seem the obvious decision to pay off your mortgage early. But is it? Unfortunately it’s not that simple, there are a number of things to check first.

 Are you allowed to repay your mortgage early?

Some mortgages penalise you for paying them off more quickly, especially if you have a special offer fixed or discount rate deal.This is because lenders want you to stick with them once the cheap rate ends, as at that point their rates shoot up. Thus it’s not in their interest to let you pay off the mortgage more quickly – after all the longer it takes you to repay, the more they earn.

Check whether there are any penalties or additional costs to making extra or higher repayments. If there are these are likely to outweigh the gains from repaying the mortgage in which case it’s time to start saving. Thankfully these penalties are becoming rarer, though most mortgages will allow you to make “overpayments” (i.e. paying more than the regular amount) in some form.

 

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