 |
What is a Repayment Mortgage?
A repayment mortgage is the type of mortgage that most people
think about. The idea behind a repayment mortgage is that you pay
monthly for a set period and each payment consists of an element
of capital and interest.
A repayment mortgage is one for which each monthly payment
contributes to the capital and the interest that is to be repaid
over the term of the mortgage. Assuming that the contractual
payment is made each month for the full term of the mortgage, at
the end of the term the mortgage will be fully repaid.
With a repayment mortgage your monthly payments consist of
both the capital amount borrowed together with accrued interest.
Your lender will keep you advised about how much you have
repaid.
Initially, most of your monthly payment pays off the interest
and what's left goes towards reducing what you've actually
borrowed. As time goes on, the 'balance' changes and as the
interest charges reduce, more and more of your monthly repayment
is used to reduce the loan.
A repayment mortgage is a mortgage contract under which the
customer is obliged to make payments of interest and capital
which are designed to repay the mortgage over the stated term. As
long as you keep up the payments, the whole loan will be paid off
over the term of the loan. Many people opt for a repayment
mortgage on for this very reason - a repayment mortgage is the
safest option as it means that you will have that guarantee.
With a repayment mortgages the entire mortgage is paid back
over an agreed period of time. This is referred to as the
mortgage's term and is usually set at 25 years. When the
mortgage's term has come to an end, providing all the repayments
have been met, the property will be in the hands of the
homeowner.
A repayment mortgage means that each month you make a payment
to your lender which consists of both a repayment of part of the
loan and a payment of the interest on your loan.
You are reducing your debt every month, and as a safeguard you
will need to arrange life assurance, which is often a compulsory
requirement with mortgage lenders so that should you die before
the end of the term your mortgage will be paid off.
Deciding which mortgage is best for you depends on a few
factors, which is why it's important for you to do your financial
homework first. Repayment mortgages are regarded as the safest
option, hence their appeal to the more cautious investor. They
are certainly much easier to understand and you should have no
trouble working out your monthly incomings and outgoings.
You may freely reprint this article provided the author's
biography remains intact:
About The Author
John Mussi is the founder of Direct Online Loans who help UK
homeowners find the best available loans via the http://www.directonlineloans.co.uk
website.
MORE RESOURCES updated Sat. May / 27 / 2023
 |
 |
 |
RELATED MORTGAGE AND REFINANCING ARTICLES:
Reaping Financial
Rewards - Bad Credit Home Equity Loans
Home is the place you inhabit. It is the place where you
live, breathe, grow, thrive.
Repayment of Loans -
Lessening the Bitterness of the Process
So how have you planned the repayment? Don't tell if you
haven't started the plannings yet. It is high time the
plannings and the decisions be made regarding the repayment
of the loan.
Avoiding Foreclosure
Scams
If your mortgage company is threatening foreclosure, there
are things you can do to avoid it (see my article titled
"How to Avoid Foreclosure"). However, you should be aware
of scams.
Top 5 Methods to Manage
Your Home Equity
As your home appreciates in value, you gain equity. You can
look at this equity, as a portion of the value of your
home, which becomes an asset that is not burdened by debt.
Flexible Mortgages -
Offering Relief from the Fixed Mortgage
A pension mortgage may seem lucrative at the first sight.
However, they seldom are, if the customers who took pension
mortgage are to be believed.
Getting The Best Home
Equity Loan
Owing to the popularity of home equity loans, there are
numerous lending agencies offering a variety of mortgage
products. A bad choice of mortgage can lead to disastrous
effects, as there is a risk involved of foreclosure and
losing one's home.
A Guide to Getting a
Home Improvement Loan
If you've got a few things around the house that you'd like
to spruce up but don't have the money for, you might want
to consider getting a home improvement loan. As the name
implies, a home improvement loan is designed to pay for
improvements to a house or other form of real estate.
Refinance Your Home
Equity Loan
Refinancing your home equity loan is an excellent way to
save money. By refinancing your home equity loan you can
lower your interest rate and finance for a longer or
shorter term.
Refinancing Your House -
How to Know Whether to Refinance or get a Second
Mortgage
Refinancing your house's mortgage is not the same thing as
getting a second mortgage. While both allow you to cash out
your home's equity, terms and rates differ between the two
types of loans.
Home Equity - Let the
Market Eliminate Your Private Mortgage
Insurance
In decades past, most people who were interested in
obtaining a home loan were required to put down at least
20% of the purchase price. Those days are gone, and as home
prices have risen faster than incomes, the average down
payment required by lenders has dropped.
Home Equity Loans
Popular Scams
Most borrowers fail to realize that when trading their much
beloved home for cash, lenders can foreclose on their
property in the case of default. Moreover, because of
fly-by-night operators who are ready to strip unsuspecting
borrowers of their most prized asset, it is doubly
necessary that borrowers be familiar with some frauds that
could be perpetrated on them.
Buying a House? How Much
Home Can You Afford?
Maybe you've heard the expert advice that your debt to
income ratio shouldn't be more than 36 percent of your
total income. But do you truly know what that means, and
how lenders will look at your financial history in order to
decide whether or not to extend you a mortgage? If you need
help figuring out your debt to income ratio, simply follow
the guidelines below and soon you'll know whether or not
you're in a position to apply for a mortgage loan.
Bridging Finance
Basics
Bridging finance is a short-term loan that is used as a way
to provide funding for the purchase of a new property while
the borrower awaits the sale of an existing property.
Unless all the stars are in perfect alignment, it's tricky
to coordinate the sale of one property and the purchase of
another property so that the transactions occur
simultaneously.
A Guide to Selecting a
Mortgage Broker in Australia
Once you have made the decision to buy a home you will need
to obtain mortgage financing for your purchase. Until about
fifteen years ago buyers had to go directly to banks to
obtain loans and shopping around for the right fit was a
long process.
Mortgage After
Bankruptcy
Most people probably assume that obtaining a mortgage to
purchase a home, refinance or to consolidate debt after a
bankruptcy is out of the question. In fact, many people are
able to obtain these mortgage services, even 1 day after a
bankruptcy discharge in some cases.
Mortgage Information for
the First Time Homebuyer
Inflation in the United States is increasing rapidly and
home prices are soaring! There are millions of american
families that are unaware of the many mortgage programs
that are available for first time homebuyers. There are many
types of mortgage finance programs available to first time
homebuyers.
What Your Mortgage
Lender Is Not Telling You About Accelerated
Mortgages
For years, mainstream banks and financial advisors have
been recommending that you pay extra cash into your
mortgage account in order to cut down the huge interest
amount and reduce the period over which you pay back the
loan. For example, if you borrow $200,000 over 30 years at a
rate of 5%, your monthly repayments would be around $1074.
A Guide to Finding Cheap
Homeowner Loans
If you're actively looking for cheap homeowner loans, there
are several things that you should take into consideration
to make sure that you get the best loan for your
money.Before taking one of the loans offered to you, you
should take the time to understand how cheap homeowner
loans work, make sure that you've explored all of your loan
options, and shop around for the best loan rate that you're
eligible for.
Zero Down Mortgage Loans
- Is 100% Financing a Good Idea and Can You Get
Approved?
Are you wondering if you can get approved for a home loan
with 100% financing? Are you also wondering if its a good
idea to get a mortgage loan with no money down? Here are
some points to keep in mind as you apply and consider your
different mortgage loan options.To qualify for 100%
financing on a purchase mortgage loan, it would be
important for you to have a credit score of at least 600 or
higher.
The Truth About Shopping
for Mortgage Rates
With so much lender advertising focusing just on rates, you
may not be aware of the importance in choosing an
experienced, reliable loan professional who can match you
with the appropriate loan program. Good loan officers and
mortgage brokers may quote today's rate when asked, but
they will quickly add they need to know more about you to
determine the best program for your individual situation.
|
used office furnishings-supplies-equipment-desks-cubicles-service-counters for
sale in Akron Ohio
Die cast model cars for sale in Akron Ohio
used cars for sale in Akron Ohio
unfurnished homes for
rent in Akron Ohio
first second
ARM compare rates find the best rates current in your area lenders read reviews calculator adjustable rate loan home lenders brokers
quotes florida houston gmac washington interest only 2nd software debt consolidation
reverse senior equity texas maryland options lending bad credit
option one ameriquest chase first banks emc residential california miami dallas est branch marketing
home company commercial yahoo online bad credit low credit no credit |
|