3 not-so-stupid mortgage questions you always wanted to ask

When it comes to a mortgage, the biggest debt you’ll ever take on, there’s no such thing as a stupid question.

Here are the answers to three questions you might feel silly asking.

1. What’s the difference between ‘fixed rate’ and other mortgage products?

‘Fixed rate’ is basically an amount of interest (3%, 4%, etc.) that you’re charged for some or most of the mortgage term.

Other deals such as Standard Variable Rate and tracker mortgages change over time, as determined by the lender or because of fluctuations in the Bank of England’s Base Rate.

There’s an interest only mortgage too, which can be set at a fixed rate.

Head to our beginner’s guide for fixed rate mortgage deals to learn more.

2. How does a mortgage broker work?

The best way to think of a mortgage broker is someone who deals with mortgage lenders on your behalf.

We’ve actually written about it in more detail, so it’s worth having a quick read of our summary here.

Brokers are either paid a commission by the lender, or by you – the client. We take a commission from the lender and we’ll never charge you a penny.

3. What is Help to Buy?

If you’re a first time buyer, the government can give you a leg-up. That aid comes in the form of a Help to Buy ISA account. For every chunk of cash you save, they will top it up by 25%, up to the value of £3,000.

This means you can save £12,000 of your own money before hitting the Help to Buy limit. What’s more, it works for every homebuyer on the mortgage. You and a partner could receive up to £6,000 towards a property.

There’s a contribution cap of £200 a month, however, after the initial maximum payment of £1,200. And never forget that the Help to Buy amount can’t be used for a deposit, arrangement fees or conveyancing costs. It’s there merely to make longer term payments easier. Take a closer look at how they work here.

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