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The Mortgage Works is a specialist lender that is a company under the Portman Building Society. It has served the intermediary market for over the last fifteen years, and today, The Mortgage Works is responsible for managing over 2 billion in mortgage assets. Individuals can apply for mortgages with Mortgage works, and the company offers a wide range of products, options, and solutions that are made specifically to meet the needs of their clients. They offer solutions that are particularly flexible when compared to other mortgage companies, so they’re considered a great option for a variety of people seeking mortgages, whether they’re first time buyers or those who are seeking to buy investment properties. They also offer mortgage products for people who are re-mortgaging or those who are buying properties with the intention to let.

The Mortgage Works offers three main types of mortgages; Status Plus Mortgages, Buy To Let Homes, and Self Certification Mortgages.

Status Plus Mortgages offered by The Mortgage Works are a type of loan available only from intermediaries. They offer two fixed rate mortgages at two years, two year discount mortgages, and tracker mortgages which change according to the base rate of the Bank of England. Status Plus Mortgages from The Mortgage works also offer other features, such as offering a combination of interest only repayments or just repayment towards the mortgage.

The Mortgage Works also offers Buy To Let mortgages, which are offered in two, three, or five year mortgage terms. These all turn into a variable rate mortgage after a fixed term has passed. One of the features for this type of mortgage is that you are able to get a two or three year tracker mortgage that is associated with the Bank of England’s base rate.

Self Certification Mortgages are made for people who have a hard time proving their income, like self employed or contract workers. Declarations are required and two fixed rate products can be chosen, a two or five year mortgage term that turns to a variable rate. Under a Self Certification Mortgage, discount and tracker mortgages are also available.

Nothing is ever certain in the world of finances, and theres no way of predicting how the market will change in the future. However, if you want to be able to plan your budget precisely, then a fixed rate mortgage might be the right option. The repayments will be fixed for a set period of time usually between the first one and five years of your mortgage, so you can be sure that any rises in the interest rate will not affect you. The term the rate remains fixed can be as long as ten years.

Fixed rate the pros

For those on a tight budget, it can be useful to know exactly what will need to be set aside each month for mortgage repayments. Also, it can be a good move to fix your rate when the economy looks like its about to change and interest rates rise. If, from studying the market, you anticipate that rates are set to rise in the near future, then taking a fixed rate now could mean you will save money over the next few years. Even if the Base Rate set by the Bank of England rises, you will be protected, at least for the term that your payments are fixed.

Fixed rate the cons

If the market changes and interest rates fall, you could lose out on a reduction in rates. Fixed rate mortgages are often set at slightly higher rates than the cheapest deals. Be aware of redemption penalties and clauses that tie you to your mortgage these can last much longer than the fixed rate period and you may find it prohibitively expensive if you want to change lenders or pay off your mortgage.

Thousands of people spend a lot of time studying the economy, and even the financial experts who predict market conditions often get it wrong. Its impossible to foresee how interest rates will change although you may be able to apply common sense to a certain degree, there is no guarantee that a fixed rate mortgage will beat the SVR five years down the line. Ultimately, you have to make the best decision you can based on the situation as it stands.

You should also check to see if the fixed rate mortgage is portable this means that if you want to sell up and move house during the tie-in period, you can transfer the mortgage to your new property without incurring any penalties.

According to a recent report consumers confidence in variable rate mortgage products is on the increase in the UK, following a substantial period of consumers tending to shy away from variable rate products, preferring instead to opt for more stable, yet more expensive, fixed rate deals. The series of five interest rate hikes between August 2006 and July 2007 resulted in many homeowners trying to remortgage to fixed rate deals in order to try and avoid the effects of further interest rate rises, as well as resulting in first time buyers opting for fixed rates to avoid the pitfalls of rising repayments during the first few years of mortgage repayments.

However, since July of this year the Bank of England has kept interest rates firmly on hold at 5.75%, making it latest announcement to keep rates stable just last week. It is thought that part of the reason for the bank’s decision to keep rates on hold is the possible of effects of the global credit crunch upon the UK’s economy, resulting in the Bank of England taking a wait and see stance. Another reason for keeping rates on hold for the moment, state experts, is that CPI inflation is now within the government’s target of 2%, coming in at 1.8%, which is its lowest in a year.

Predictions from analysts and economists that the Bank of England will not raise interest rates again for the remainder of the year has seen renewed interest in variable rate mortgages from consumers in the UK, with many breathing a sigh of relief over the fact that repayments are unlikely to be affected by further interest rate rises this year. This renewed interest has been further fuelled by additional speculation that interest rates may even fall by the end of this year, with many economists expecting or urging the Bank of England to cut interest rates. Many are now expecting rates to fall by at least a quarter point by the end of the year.

Interest in fixed rate mortgages peaked recently, as homeowners and first time buyers struggled to find a solution to the problem of rising repayments resulting from the hike in interest rates. However, some experts have even predicted that interest rates could fall back to around 5% by the end of next year, so many consumers may want to avoid tying themselves into more expensive fixed rate deals under fears that they may end up paying way over the odds in six or twelve months’ time.

One of the most important aspects of buying a property is the mortgage interest rate that you can obtain. After all your looking to borrow the amount required for your property for the lowest possible cost.

Standard variable rate is the typical rate of interest that lenders use and it is generally the most expensive option for the borrower. The standard variable rate is the rate of interest decided by the lender which maybe loosely connected to the Bank of England base rate by a margin normally around 2%.
If you are on a standard variable rate then you may notice that some lenders like to involve any rate increases with effect straight away. At any rate the standard variable rate is not the cheapest option available (based on circumstance). As a independent broker we can help you take advantage of any cut-price offers from other lenders.

A fixed rate is exactly as its called, the rate of interest is fixed over a certain period of time, generally between 1-5 years. Fixed rate mortgages are generally easier to manage since youll know how much is needed for the monthly repayments on your mortgage. The fixed rate mortgage is ideal for people who maybe under financial stress and need to know where they stand from cheque to pay cheque. Fixed rate mortgages are also suitable if interest are set to rise in the early years of a mortgage. Be aware that mortgage providers are usually one step ahead to adjust fixed rates accordingly. A Fixed rate mortgage means you could end up stuck with paying more then others if the interest rates fall below the figure youve adjusted yours to.

Discount rates are a percentage of the lenders variable rate, so your repayments will rise and fall in accordance with the lenders normal rate but you will be paying at a reduced rate over an according time period. This is ideal for first time buyers as a discounted mortgage can give you a few years of breathing space. A 1 -2% discount is very good if there is no lock in period afterwards, with the benefits of this come the ability to remortgage with another lender when the discount rate period draws to an end. Unfortunately you may often find you are locked in for another couple of years on the variable rate so you will not be able to get out of this sort of deal unless you are prepared to face huge redemption penalties. Discount mortgages offer good value for money – but only if there is no lock-in period once the discount has come to an end.

A capped rate will put a barrier to your interest rate you will pay over a certain period of time. If the lenders variable rate exceeds the capped rate then it is here you will benefit, but if the interest rate falls below the capped rate then you will paying the same as many others.
Capped rates will tie you into a mortgage for a certain period of time, usually between 1 and 5 years although recently there has been an introduction of capped mortgages for 25 year periods.
Capped rates give you a mix of advantages of the fixed rates and variable rates, again something is expected in return for this, the capped rate is likely to be higher than any fixed rate you can get. Like fixed rates the capped rate will make financial sense for those who are financially stricken.

Tracker rates tend to follow the Bank of Englands interest rate with a margin either above or below the rate, this is decided by the lender.
How will the interest be charged? Ignoring the type of interest rate you decide to go with one vital question to ask is how frequently is the interested calculated. If you decide to go for a mortgage where the interest is calculated daily then you will find yourself paying less interest over a period of time because every payment will reduce the amount you owe. Current account and flexible mortgages charge interest day by day. If interest is calculated monthly you could end up paying more and you can end up waiting a month after a payment is made before the interest is recalculated. But some lenders have their foot in the door by calculating the interest payable on the amount due at the start of the year and this could make a significant difference to the amount of capital reduction over 12 months. It also means that if you make an additional payment to reduce your mortgage it could be up to a year before this reduces the amount of interest you are charged.

You can compare mortgages by looking at the amount you need to pay every month. Dont be fooled by latest headline rates as they can be misleading as we know different companies charge different interest rates in different ways. The ideal target is a competitive interest rate that carries no redemption penalties so that it is cheaper to move your mortgage elsewhere if more attractive mortgages become available.

By law mortgage providers have to provide an Annual Percentage Rate (APR) for their products. It illustrates the true underlying interest rate, including all the charges, over the entire term of the loan. This means it adjusts for things such as annually charged interest. Comparing the APR of one loan against another can also help you get a better feel for which is the most competitive.