Larger Mortgages Are More Affordable Than Ever
Owning a million pound home is no longer the stuff of fantasy, thanks to today’s low interest rates and highly flexible mortgage products
The property market has managed to withstand everything the economy has thrown at it over the past decade, including the global downturn, a plummeting pound and even the ongoing uncertainty over Brexit. While other forms of investment have struggled to return any kind of yield, bricks and mortar remains as safe a way to tie up your wealth as it has ever been.
Of course, owning a high-value property also brings additional benefits that you just don’t get with stocks, bonds or unit trusts. After all, who wouldn’t want to live in a million pound home? With £800,000 mortgages available that will set you back as little as £3,000 per month, joining Millionaire’s Row has never been more affordable.
How to get the best deal
Of course, not everyone walking into a high street bank is going to be offered a mortgage deal like the one described above. The two factors that will dictate just how good a deal you can get are your own circumstances and the mortgage broker or agent you choose to go with.
To address the second point first, it is always wise to shop around. In particular, look for a broker who specialises in higher value mortgages, as they are likely to have access to special deals that you won’t find on the high street.
The other factor is, of course, your own financial circumstances. The rates on offer are all a function of risk, so to get the best possible deal, you will ideally have a solid credit history, a significant deposit to put down and an income that can comfortably meet those monthly payments.
If you are not able to tick all of those boxes, however, don’t panic. One of the big advantages of using a specialist broker is access to lenders who can meet your bespoke needs. So if, for example, your credit rating is not as healthy as it could be, they can still find a lender who will offer you a competitive deal, provided you have the finances behind you.
Look for flexible terms
The days when a mortgage was over 25 years, and neither more nor less, are long gone. These days, we are working later into life, we live longer and we have an altogether different attitude to debt to that of our parents and grandparents. The watchword of the 21st century is flexibility, and this is something to discuss at length with your mortgage broker.
30 or even 40 year mortgages are nothing unusual, and can really bring down the monthly payment. However, always keep in mind that the longer you are paying the mortgage, the more it is ultimately costing you. Today, many lenders offer the possibility to overpay – this essentially means that if you have a little extra at your disposal, you can use it to repay more from the principal amount earlier. It’s an option worth taking up if you are in a position to do so, as it can result in significant savings over time.