What is a Mortgage Indemnity Guarantee (MIG)?
I am self- employed, can l get a mortgage?
My credit rating is poor, how will this affect
me?
Will redemption penalties affect me?
Exchange of Contracts:
What
are CAT Standard Mortgages?
What
is APR or Annual Percentage Rate?
What
are the implications of Daily interest?
Can
I change the term of the mortgage?
What
is a Mortgage Indemnity Guarantee (MIG)?
This
is a fee that is charged by the lender for a loan over a certain
amount (usually 80% of loan to value). This is a single premium
insurance policy that is paid by the borrower to the lender. This
premium is either paid direct by the borrower, debited to the
mortgage account or added to the advance. It protects the lender
in the event of a default by the borrower. If repossession and
eventually the sale of the property occurs, any loss suffered
by the lender, is claimed against the indemnity insurer for the
amount of monitory loss. It is important to note that the MIG
insures against the possibility of loss, but it does not cover
the obligation of the borrower to repay the loan.
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I
am self- employed, can l get a mortgage?
YES.
Most lenders will want 2-3 years accounts, although there are
specialist lenders that can solve any difficulties you may have.
If you have any worries, please speak to one of our qualified
advisers who will point you in the right direction.
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My
credit rating is poor, how will this affect me?
It
depends on the severity of the problem and how long ago it occurred.
Typical APR is 7.1%. If you fall into this category, please contact one of our qualified
advisers to discuss your situation.
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Will
redemption penalties affect me?
This
type of penalty is generally a condition should you repay part,
or full repayment of your loan during a specified term, then you
will be liable to pay a penalty. If this applies to you, it will
be mentioned in your Mortgage Offer. They are not payable on all
types of mortgages, but could apply to special deals, for example
a 2 year fixed rate mortgage. To see if this would affect you
on a loan you may be considering, please contact one of our qualified
advisers.
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Exchange of Contracts:
Once
the signing and exchange of contracts between the seller and buyer
have been completed, both parties are committed to the transaction.
The buyer or purchaser is now responsible for insuring the property.
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What
are CAT Standard Mortgages?
CAT
standard mortgages were introduced as an option for applicants,
who wish to have some clearly stated guarantees in respect of
the charges, access and terms that will apply. However this type
of mortgage does not always mean that a CAT standard product will
be the most suitable product of an individual. When a CAT standard
mortgage product is chosen, an intermediary is not permitted to
charge the client a fee.
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What
is APR or Annual Percentage Rate?
Annual
percentage rate (APR) is an industry-wide method of comparing
interest rates and charges for credit between lenders so that
the borrower can make an informed decision on the price implications
of the product. APR is not a ‘true’ rate as such;
it is calculated by using a complicated formula, which takes into
account of some (but not all) costs of setting up the loan.
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What
are the implications of Daily interest?
Many
financial institutions have moved to the daily interest system
or are considering doing so. The system is similar to that applied
to credit cards. The system adjusts the debt every day taking
into account all transactions. As a consequence, early payers
are rewarded and late payers are penalised.
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Can
I change the term of the mortgage?
It
is possible to reduce and increase the term of the mortgage?
To
reduce the mortgage term, the borrower can make larger monthly
payments than those in the original mortgage contract. This will
in effect reduce the amount of interest payable on the mortgage.
The mortgage term can also be extended. This is sometimes an option
for borrowers who have run into financial difficulties. It has
the effect of reducing the monthly repayments and hence making
the mortgage more affordable.
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