All about Mortgage & mortgage payments

When it comes to mortgage you need to have good knowledge on it. The property investment market is growing rapidly in the UK and these apply particularly to commercial investment or buy to let properties. Buy to let properties mean houses, offices, restaurants and industrial premises that the investor is buying in order to let them out. As a general rule those who lend money on commercial buy to let property will expect the rental income on that property to cover all of the mortgage payment plus another thirty percent. While all lenders will be different and all mortgage payments will not be the same most lenders will lend up to seventy five percent of the appraised value of the property. Some lenders will lend more but this will mean a higher rate mortgage payment – it may also mean that you will have to have private insurance which may be added onto your mortgage payment.

When you apply to borrow money for a commercial property then the lender will probably want to see some sort of financial statement including your liabilities and any existing leases on the property. When it comes to mortgage payments on a commercial property the mortgage may be for anything up to twenty five years. The mortgage might be a variable rate which would be one and a half to three percent more than the Bank of England’s base rate. However, it rises and falls when the bank rate rises or falls. Often there is a one percent mortgage arrangement fee which is added onto the loan as part of your mortgage payments.

You might have a fixed rate mortgage which means when you make mortgage payments the interest is fixed at a certain rate for a specified time limit. If you have a capped rate mortgage that means the interest on your mortgage payment cannot go beyond a certain level. However, capped rate mortgages usually mean that your mortgage payment will be for a specified time. This could mean that if you have enough money to clear your mortgage payment you won’t be able to do that before the specified time is over – or if you can make mortgage repayment early then you could be subject to an early repayment charge.