Compare first time buyer mortgages FAQs
- Simply speaking, a mortgage is a specific loan that you take from a bank in order to buy property. You may wonder what the difference is between a mortgage and a loan. Well, the main difference is in what happens if you fall behind with your payments. With a regular loan, the bank or provider of the loan will chase you for it in the same way that they would for most other types of credit product. If you fall behind on mortgage payments, however, the bank or mortgage provider can take (repossess) your home. The personal property is tied to the financial agreement, so if something goes wrong, the property you used the mortgage to buy could be taken from you. A mortgage is a financial necessity for most home purchasers, enabling the cost of a property purchase to be spread over a number of years.
If you are looking around and thinking about how much you can afford when it comes to buying property, before you find the home of your dreams and put in an offer and apply for a mortgage to buy that property, you should do your research, compare deals and apply for a mortgage in principle. A decision in principle is basically being pre-approved and while it does not absolutely guarantee that you will be granted a mortgage from that mortgage provider, it does mean that, in theory, they will approve you (having checked your credit rating and financial circumstances) for a mortgage of the value that you will require. Getting a decision in principle before you make an offer on a property can mean that the whole process of buying your home will go more quickly and more smoothly.