If you are thinking of taking out a mortgage, choosing the right one depends on many factors some of which we are going to cover in this blog. If you want to know what goes into choosing the right mortgage, let’s dive right in.
Your Deposit and Borrowing Amount
The type of mortgage you apply for will ultimately depend on two things, the deposit you have saved up and how much you are allowed to borrow based on your earnings. The higher your deposit, the less you will need to borrow and your mortgage will be paid off over a shorter period of time. Typically you will be allowed to borrow roughly four times your earnings per person against a new home.
Lender or Broker?
When looking for the right mortgage for you, you should take into consideration whether you will apply for a mortgage via a broker or approach the mortgage lender directly. If you have everything you need already, you might prefer to go straight to the lender. A broker does not lend you the money themselves but helps you to approach a lender with all of your documentation in order, they will also help you decide which mortgage is right for you based on your individual circumstances.
Fixed Rate or Variable?
A fixed rate interest loan will remain at the same rate for the life of your mortgage or for whatever term you choose, three years or five years for example. This can provide some peace of mind that your mortgage payment will not rise but also means you won’t benefit if the Central Bank lowers the interest rate in the future. If you can afford your fixed rate every month and you don’t see your circumstances changing, this option could suit you. A variable rate mortgage will rise and fall periodically to reflect the increase and decrease of the Central Bank and could be a good option for you if you want to possibly lower your mortgage payments in the future. The flip side to this is they could also increase over time.
Here are some more top tips…
Do Your Research
Whatever mortgage you choose, it’s important to do your research first based on your own circumstances and what you can afford. A mortgage is a big commitment and not one to be taken lightly. Familiarise yourself with the different types of mortgages, house prices in your area and dig deep into your own finances to see what you can realistically afford.
Use a Mortgage Calculator
A mortgage calculator is a handy way to see how a mortgage will affect your personal finances and whether a monthly mortgage repayment is sustainable for you. You are welcome to try out our very own mortgage calculator here on our website.
Talk to an Expert
If you are thinking about applying for a mortgage and you aren’t sure what you need or which mortgage is right for you, we highly recommend talking to an expert who can help you navigate your mortgage application with ease and choose the right terms for you. Ready to get started? Book a mortgage appointment with our experts here.