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There are so many types of mortgages on the market today; it is easy to understand why a person could get confused. Below is a list of some of the more common types of mortgages that are currently available.
1) 100% Mortgage—this type of mortgage allows a borrower (usually a first time borrower) to borrow the entire amount need to purchase a home. In most cases, a substantial down payment is unnecessary for this loan.
2) 125% Mortgage—this loan would allow a person to borrow 90% or the property value and an additional 25% with no security, for use toward costs associated with home ownership. In the current economic climate, this loan is virtually unavailable.
3) Graduate Mortgage—a specialized mortgage for recent UK graduates. Qualification requires the borrower to have graduated within the last seven years and to have been employed for at least one year.
4) Islamic Mortgage—this mortgage is only given to members of the UK’s Muslim community and is compliant with Islamic Law, which forbids giving or receiving interest.
5) Equity Release Mortgage—a mortgage taken against one-half of your property, given to the borrower in a lump sum, payable at the time of the mortgage holder’s death. This mortgage usually requires the property to be sold in order to repay it.
6) Poor Credit Mortgages—Mortgages given to people who have a bad credit history or no credit history at all.
7) Green Mortgages—mortgages given to allow someone to build or buy an eco-friendly property.
 Self-Certified Mortgages—made available to people who are not able to verify their income. This would be for someone who is self-employed, for example.
9) Commercial Mortgages—Loans given to help someone purchase a commercial property.
10) Off-set Mortgage—A mortgage which enables the borrower to pay interest on the net amount of the loan instead of on the initial amount.
As you can see, there are a number of types of mortgages to choose from. The UK mortgage system is vast and will likely enable nearly anyone to obtain a mortgage. Whether you are a student, young family, first time homebuyer, or small business owner, there is a mortgage to suit you.
If you are shopping for a mortgage, you should probably get in touch with an independent mortgage broker. This broker will be able to help you navigate the choppy waters of selecting the right mortgage for your needs.
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Loan Alliance.co.uk 2006 -2009 All Rights reserved
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