mortgage solutions
In such challenging times selecting the right mortgage can make a huge difference in your
current and future disposable income. To predict the movement of interest rates over 2-3 years
is difficult and can involve a large degree of risk.
Sigma have the benefit of being whole of market mortgage advisers, this means that we are not
tied to any one provider of mortgage products which together with our wealth of knowledge and expertise your can rest assured that we will recommend the right solution for you. The amount of mortgage products alone can be daunting, we ensure that through careful realisation of your current position that we explain what you need to know. Whether it be arranging a loan to purchase your new home to moving to a currency mortgage we have the in house experts to help you navigate through the maze of different options.
Fixed rate mortgage
These mortgages are offered at a specific rate of interest over a set period of time meaning your mortgage payments will be the same each month over the period. This helps you budget and
means you haven’t got to worry about interest rate changes resulting in your mortgage repayments
going up. But of course you will not benefit from lower monthly payments if mortgage rates fall.
Standard Variable Rate (SVR) mortgage
The SVR is a mortgage lender’s default rate which usually follows the Bank of England base rate. The rate of mortgage paid will be a few percent higher than the base rate. You need to check whether lenders variable rates are higher or lower than their fixed rates. Once a fixed rate mortgage ends, if you do not (or cannot) remortgage then you will start paying interest based on the lender’s SVR, which may involve a jump or reduction in your mortgage repayments.
Discount rate mortgage
This is where the lender offers you a rate which is lower than its SVR for a given period,
usually the first few years of the loan. After this the mortgage will switch back to the SVR.
They are attractive as they offer you a saving in the early part of the mortgage.
Capped rate mortgage
Capped mortgages are similar to SVR mortgages with the added advantage that the rate cannot
rise above a certain level for a designated length of time. Therefore capped mortgages give
(temporary) protection against rising rates but are typically more expensive than fixed rates.
Base rate tracker mortgage
This mortgage will track the Bank of England base rate. It can make advance planning more
difficult because your mortgage payments may change on a monthly basis but a tracker is a
good bet in an environment of falling interest rates.
YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS
ON A MORTGAGE OR ANY OTHER DEBT SECURED ON IT.