Fixed, tracker and first-time buyer - the different types of mortgages explained
09.04.2024 - 15:25
/ manchestereveningnews.co.uk
Buying a house is the biggest financial commitment most people will make in their lifetime. Before going ahead with the purchase, it's important to understand the various different types of mortgages that are available to help you buy your home.
With house prices fluctuating and mortgage rates rising in line with interest rates, there are a range of different mortgages deals - and depending on your circumstances - some may be more affordable for you.
Experts suggest that the Bank of England may lower the base rate by 0.25 percent in June, which could save tracker mortgage holders around £300 monthly. But a study by Barratt Homes finds that two-thirds of UK homeowners may miss out on these savings due to a lack of knowledge about mortgages.
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The property developer surveyed 500 homeowners across the country to assess mortgage understanding, revealing which types are least familiar. Here they explain the different types of mortgages available, along the pros and cons of each one.
Adrian MacDiarmid, head of mortgages at Barratt Developments, said: "Choosing the right type of mortgage is important, as it can help save you a lot of money. While a fixed-rate mortgage is the most popular option overall, there are a lot of new products available now tailored to specific buyers.
“We have already seen some cuts to mortgage interests at the start of the year and would expect more lenders to follow in the coming days. There are a lot of lenders competing for market share and this will bring more opportunities to buy a home.
“Prospective buyers who feared that purchasing their own home was beyond them - because of barriers