What is a UK Mortgage ?
A UK Mortgage is formal document that provides legal claim on your property and is held by the UK mortgage lender as security for the money that you borrowed off the lender. UK Mortgages can be taken out after you have already paid out a property usually for up to the cost of the property and if you default in this case the mortgage lender will hold the UK property title, the mortgage, in exchange for the outstanding funds. In essence a UK mortgage is a mortgage lender holding your property as a means to ensure you pay back the amount of money you borrowed from them as well as any interest they charge on this amount. The majority of people applying for a mortgage in the UK are applying for a first time buyer mortgage to cover the cost of the house that the bank will in trust until the mortgage is paid.
There are several different types of Mortgages available on the UK mortgage market. The most stable mortgage is the fixed rate mortgage where the interest rate is set to a set amount by a mortgage lender. This amount will decrease over the years as you pay off more and more of your mortgage but with a fixed mortgage you can never pay in more than the set amount per year. Flexible mortgages allow you to pay in any excess amount, and you can usually find a flexible mortgage with a fixed low interest rate that will last the term of the mortgage. Variable Rate mortgages are simply what the name suggests, mortgages where the interest rate rises and falls with the Bank of England's interest rate. They are the riskiest of all the mortgages but also have the possibility of saving the mortgagee a great deal of money on their UK mortgage.