Borrowing

What is a mortgage?

A mortgage is a loan which is secured against your home.  When you take out a mortgage you agree to pay the loan back with interest over a period of time agreed with your lender. If for any reason you cannot repay the loan, the mortgage lender can sell the house to recover the debt.

What types of interest rates deals are there?

Fixed-rate - your interest payments are fixed for a set period of time after which you will be moved on to another rate, such as the standard variable rate or tracker rate.

Standard variable rate - your interest will vary with your lender's mortgage rate.

Tracker rate - your interest rate will move up or down by tracking an external rate such as the Bank of England rate or London interbank rate.

Discounted rate - your interest rate will vary with your lender's standard variable rate but you get a discount for a set period of time.