Compare the best Mortgage Rates

For a lot of people, sorting out their mortgage is akin to a trip to the dentist, but it doesn’t have to be that way. Before you start looking, make sure you know what you’re looking for – that way you won’t get lost in the forest of deals out there.

Remember that the mortgage you choose is going to have an impact on your monthly finances for a number of years, so it’s important to seek out the best deal – which may not necessarily be with the bank or building society you normally use for your personal finances.

So make sure you’ve considered the following before starting your mortgage search.

Rate type

How do you feel about your mortgage payment? Would you rather know what you’re paying, or are you on a tight budget and need payment stability? If that’s the case, then a fixed rate is for you.

If on the other hand, you don’t mind taking a chance, in return for the prospect of possibly paying less, then a variable rate might be the way to go. Variable rates include tracker interest rates and discounted rates – they tend to move down and up in line with underlying rates, such as the Bank of England base rate.

However, you should only consider a variable rate mortgage if you can afford a payment that’s quite a bit higher than you are quoted at the outset. Because variable rates can go up as well as down – your payment could increase by hundreds of pounds, so you need to make sure you can cover this.

Term

When it comes to your mortgage, one of the most important things to think about is the term – primarily what we’re talking about here is the full term of your mortgage. Strictly speaking, you should aim to set your mortgage term for as short a period as possible as you will not pay as much interest. However, a shorter term does mean higher monthly payments.

A good compromise here is to set a term for a payment you can easily afford, and then overpay in addition. Then, if you fall on hard times or need to reduce your payment unexpectedly, you can pause the overpayment part, to give you some flexibility (see below).

When considering the term you should also think carefully about how long you would like the initial deal period to run for. Shorter introductory rates – one to two years – will be very attractive, but remember that after then, they will almost certainly increase. If you remortgage again after this period, you may find that the cost and upheaval of regular remortgaging, outweigh the gains you get from a lower short term rate.

Longer term fixed introductory rates have their pitfalls as well as, if rates go down, you could end up paying over the odds for your mortgage, whilst others enjoy lower rates.

Deposit/Equity

The amount of deposit you have to put down (or equity you already have in your home) plays a crucial factor in the rate you can achieve. Quite simply, the higher the mortgage in relation to the value or purchase price of your home (LTV), the greater the risk to the mortgage lender.

This means that the higher the LTV, the higher – generally speaking – the rate of interest, to compensate the mortgage lender for the greater degree of risk they are taking. You’ll see that the mortgages in our Best Buy tables all state a maximum LTV – the highest possible proportion of borrowing against property price or value – that you can have on that mortgage.

So in the lead up to securing a mortgage, it’s a good idea to save or overpay as much as you can, so that you can bring down your LTV, and get a lower interest rate.

Flexibility and portability

A mortgage that allows you to overpay, underpay, take payment breaks and/or borrow back money is often referred to as a flexible mortgage (you can get a more in-depth explanation of all the features by clicking the link).

So if you think you’ll want to overpay, or might need the option to pay less or suspend your payments later (during a planned sabbatical for instance), you’ll need to make sure you search for a mortgage that will allow this.

Another thing to consider, if you’re thinking of moving in the next few years, is a mortgage that allows you to “port” or take your borrowing from your current home to the next.

This means that, because you don’t have to finish one mortgage and start another one, you can avoid having to pay both an Early Repayment Charge on one mortgage and set up fees on a new one (although there will normally be a porting fee, this will be a lot less that the fees you would have to pay if taking out a new mortgage).

What next?

So now you know what you want, you’re ready to see what’s available to you. To view our Best Buy charts, simply use the drop down menu at the top of this page or click on the links below:

First Time Buyer Mortgage deals | Remortgage and Tracker Mortgage deals | Discounted Variable Mortgage deals | Variable and Tracker Mortgage deals | 2 Year Fixed Rate Mortgages | 3 Year Fixed Rate Mortgages | 5 Year & Over Fixed Rate Mortgages

Or click for Buy-to-Let Mortgage deals

Other useful links:

Our mortgage calculator

Our mortgage search