Self Build Mortgage Types. Self-builder mortgage types

Types of Self Build Mortgage

As an experienced, independent mortgage broker, you will receive completely independent advice covering the whole of the mortgage lender market. Like all mortgages, you also have the choice of products including fixed, discounted, variable and offset. We will help to find the best and most suitable self build mortgage product for you.

How to Choose the Best and Most Appropriate Self-Build Mortgage

Free Special Report By Mary Riley, Grand Designs' Self-Build Mortgage Expert Get the facts...

Tracker

Also known as a base rate tracker, the rate tracks the Bank of England base rate for a specified period. When the base rate changes, the amount that you pay changes too. At the end of the period, the interest rate will revert to the variable rate, which may be substantially higher and involve substantial increases in the monthly payments. There may be financial penalties for not staying with the lender for a certain time after the end of the period.

Discounted Variable Rate

Rates are discounted from the standard variable rate for a fixed period, following which they return to the standard variable rate. This enables the borrower to reduce their monthly commitments during the first few years of their mortgage.

Fixed Rate

Rates are fixed at a certain level for a specified period. If interest rates rise above the fixed rate during that time, the borrower will continue to pay the lower monthly payment. This enables the borrower to keep their monthly payments down in the early years and to be aware of their exact commitment. Should interest rates fall, the borrower will pay the higher amount.

Variable

This is the lender's standard product. The rate usually moves in line with the Bank of England's base rate for the duration of the mortgage although it may also change at other times.

Capped Rate Mortgage

The interest rate charged is set to not exceed a specific level during a specified term, although if rates fall below the capped rate, the borrower can take advantage of any interest rate falls. This guarantees that your mortgage payments will never go above a certain figure within a defined period.

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