Common questions

Help and advice about mortgages

Can I get a mortgage offer before I find my property?

You can choose the mortgage that suits you best and get an 'agreement in principle' from a lender. However, your lender won't make a formal mortgage offer until a valuation has been carried out on the property you wish to buy or remortgage.

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Do I have to clear my home loan by a certain age?

A mortgage is usually designed to finish no later than your normal retirement age. That age is taken as 65 for employed people (male and female) and 70 for the self-employed. Some lenders will consider a longer term if you have enough income after retirement.

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What does APR mean?

APR stands for Annual Percentage Rate. We calculate APR by taking into account the interest on the loan together with other charges you may have to pay: for example, fees and/or fees and costs for taking security.

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How do I repay capital with an interest-only loan?

Interest-only mortgages pay off only the interest on your loan, not the money you borrowed in the first place. In order to repay the capital borrowed, you normally save money in a separate plan. The main options for saving in this way are by using an endowment policy or a pension.

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Do I always need life insurance?

When you take out a home loan, your lender needs to be sure that you'll be able to pay it back, even if you lose your job, become unwell for a long period or die.

Because of this, many lenders insist you buy life cover when you take out your mortgage. We strongly recommend you take out an appropriate life cover policy for the value of your mortgage. We can give you a quotation.

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What other costs might I incur in taking out a mortgage?

When you take out a mortgage you should be aware that, on top of the mortgage cost, you're likely to have to pay a valuation fee and booking fee for fixed rates on application. If you break a fixed or discounted deal before the end of the deal period you may be charged a fee. Arrangement fees may also be payable and you should also remember the legal fees and if the property is in the UK Stamp duty may be payable.

Once you own your property, you will need to take out adequate buildings insurance and it is advisable to take out contents insurance as well as sickness and unemployment insurance, for your own peace of mind.

Some mortgages offer a free valuation, or a refund on or after completion, whilst others include cashback sums that you can use to offset your costs. If you are remortgaging your property, you may also find that your new lender will offer to pay some or all of the legal costs.

You should always look at the total mortgage package and not just focus on costs or just on the interest rate.

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What is the difference between a Standard Variable Rate (SVR) and a tracker rate?

The SVR of each lender is set by that lender and they can vary it at any time. Although lenders normally change their SVR as a result of The Bank of England Base Rate changing, they don't always change them by the same amount.

With a tracker rate, the mortgage tracks an independently set interest rate, such as The Bank of England Base Rate. The benefit of a tracker mortgage is that any falls in interest rates will be passed on to you, usually from the beginning of the month after the rate change. However, any rises in rates are also be passed on to you.

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What if I want to rent out my place?

You'll need to tell us before agreeing any tenancy. We usually grant consent, although we reserve the right not to, and a fee may be charged. We may allow you to remain on your existing deal until it ends. When you take a new deal, if you are renting the property out, you'll need to select a rate from our attractive range of buy-to-let products.

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What if I lose my job?

You must tell us immediately of any change in your circumstances that could affect your ability to meet your mortgage repayments.

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What if I am having trouble paying my mortgage?

Treating you fairly when you cannot pay your mortgage. If you are having trouble paying your mortgage, we will treat you fairly.

We will:

  • contact you as soon as possible to discuss your problem;
  • talk to agencies who give advice (for example, Citizens' Advice) and are acting on your behalf if you want us to;
  • give you a reasonable time to pay back the debt; and
  • only start proceedings to repossess your home if we cannot solve the problem with you.

We might be able to:

  • arrange a new payment plan with you taking your and our interests into account;
  • change the way you make your payments or the date you make them;
  • allow you to pay back your mortgage over a longer period of time (which could reduce your monthly payments). This may increase the total amount you pay back; or
  • change the type of mortgage.
  • If we cannot do any of these things, we will tell you why. If we can make one of these arrangements with you, we will explain how it would work and give you an agreed period of time to consider it first.

What you can do to help us:

  • Tell us as soon as possible if you are having problems repaying your mortgage, or anticipate having problems.
  • Get in touch with us quickly if we try to contact you.
  • Make sure you keep any other people paying the mortgage, and anyone guaranteeing the mortgage, up to date with what is happening.
  • Keep to the payment plan we agree with you. If you do not make the payments, we might have to go to court to get back any money you owe us or to repossess your property.
  • Check whether you can get any state benefits or tax credits.
  • If you have an insurance policy, check whether it would help with your payments.
  • Tell us if you move to a new address.
  • You may want to talk to a professional adviser, such as a debt counsellor or a solicitor, before you change your mortgage arrangements.

Costs and charges

We may charge you for administrative and legal costs. We will tell you the amount you will have to pay.

If we cannot agree on a solution

If we cannot agree on a payment plan with you, we may go to court to start proceedings to repossess your home.

We will keep trying to solve the problem with you, by talking to you about a payment plan, throughout the process or assisting you with the sale of your property.

If we repossess your home

We will sell it for the best price we can reasonably get. We will try to sell it as soon as possible. Interest is charged on the amount outstanding on the loan until it is fully repaid.

We will give you reasonable time to take your possessions from your home

We will use the money raised from selling your home to pay your mortgage first, then any other loans or charges secured on the property.

If there is any money left over, we will pay it to you. If there is not enough money from the sale to pay the whole mortgage, you will still owe us the amount that is left. We will tell you what this is as soon as possible and contact you for you to arrange to pay back what you still owe.

If you bought your home with other people, each of you is responsible for all the money borrowed. This is true even if you normally only pay part of the mortgage.

We will take account of your income and outgoings when we arrange a payment plan with you. But if we cannot arrange a suitable plan, we may go to court to get our money back. You might have to pay the court and our costs.

Not being able to pay off your mortgage could affect whether you are able to get credit in future.

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