How To Get A Cheap Mortgage With The Lowest Interest Rates

There are loads of different mortgages and finding a good deal could save you money. However, the task of finding the best deal isn't always easy. But if you know how to get a cheap mortgage, you'll make it much easier for yourself whilst saving money.

What kind of mortgage do you want?

There is more than just one kind of mortgage - and certain ones could be more beneficial to you than others. Do you know the difference between a repayment mortgage and an interest-only mortgage?

Category of different types of home loans

With an interest-only mortgage, you need to make a plan as to how you're going to pay off your debt, because the regular payments that you make will only cover the cost of the interest. Once you've paid the interest, then you'll have to pay the cost of the debt in one go.

Although a repayment mortgage will generally cost more money than an interest-only mortgage each month, it also pays off the original debt.

You'll also need to decide whether you want a fixed or variable rate of interest.

What are fixed and variable rates of interest?

Fixed rate interest is usually the more preferred option, because you'll know what your mortgage repayments will be for the set time period. With a variable rate, the amount needed for a repayment can change as the market rates change. It may be worthwhile to remember that this can be both good and bad for those making regular repayments.

Why? Well, you could end up paying half of the original amount back, but you could also be required to pay double the original amount a month later. Usually, variable rates end up saving people more money than a fixed rate down the line, but you can never be sure.

Know what you can get

You need to know what rates you're able to get before you do anything else, whether you chose a fixed or a variable rate mortgage. The value of the property and the size of your deposit are what decide the amount.

Also, don't just go to your local bank. See what they have to offer and then check out what other offers you could get. You could find that there are loads of deals which can help you more than your bank could - and without checking first, you simply wouldn't know any better.

You should also make sure that you will definitely be able to pay back the amount of money needed each month. If you're unable to find one that you're sure you can afford, you should keep on searching.