- Tracker rate; variable payments for more flexibility
Tracker rate mortgages are directly linked to the Bank of England base rate; hence, if you choose this type of mortgage, your monthly payments may increase or decrease depending on the bank’s base rate situation.
- Part and part mortgages; the best of both worlds
This type of mortgage is a mix of both fixed and tracker rate mortgages. It allows clients to split their home loans and merge the security of fixed-rate and the flexibility of tracker-rate mortgages. On the tracker-based half of your mortgage, your repayments may increase or decrease based on the Bank of England base rate, while on the fixed-rate half, an additional fee may apply to early repayments.
This repayment option is based on your monthly instalments to pay off your mortgage loan. Whatever amount you pay each month is put towards paying off some of the initial amount borrowed and interest on your debt. Initially, your repayments are made up of more interest and less capital. But over time, this is reversed as your debt decreases, and the interest on it falls. This shift will continue to occur as your monthly repayments go towards paying off the capital.
As long as all your repayments are made on time, you can repay the entire borrowed amount plus interest at the end of your mortgage, usually up to 25 years.
As its name indicates, interest-only repayments allow you to pay only the interest back each month, which means that you would still have to repay the capital you borrowed at the end of your mortgage period.