The mortgage interestrate that you are ultimately going to be charged by your bank will be a major factor in deciding which mortgage of the myriad on offer you will take out and also, which mortgage lender you will go to. The interest rate that you are going to be charged will dictate, for the next few years at least, how much the mortgage is going to cost you. It will determine how much of your monthly budget will be being spent on repaying your mortgage and, therefore, how much of your valuable income is available for you to spend on other regular bills and leisure time.

But what factors will be affecting the mortgage rates that are available to you? For a start, the type of mortgage offer that you are interested in will dictate what the bank will offer to you. If you compare top mortgage rates for fixed and standard rates, you would usually find banks offering special rates on their fixed rates making them less expensive than their standard ratemortgagess. This is the incentive for you to approach the bank and take out a mortgagewith them. Later, when you have passed the initial cheap phase of the mortgage and the incentive is approaching an end, your bank is hoping that you decide to stay loyal and take the easy option and not remortgage to a better deal within the bank, or worse still, a new bank.

The length of your incentive period will also dictate, in part, the actual rate that you are being charged. For example, you may get from your lender a very low fixed rate mortgage if you only fix it for a period of 6 months, but a slightly higher interest rate if instead you are trying to fix the mortgage rates for 5 years. Tied into this, there may be a further lock in period once the incentive offer has ended, during which you are forced onto the bank’s standard variable rate mortgageproduct. This time, typically the longer the lock in periodthat follows the incentive, the better the incentive rate that you will be offered at firstto draw you in.

How much you are able to put down out of your own money as a deposit may also affect the mortgage rate that you are offeredwhen you first take out your mortgage. For example, if you are unable to put down at least a 25% deposit on your new home, then you might find that the interest rate jumps up by a quarter or even half of a percentage pointas an insurance policy against you defaulting and owing them a lot of cash.

Trying to compare top mortgage rates on your own is a difficult taskand can be costly if you get it wrong. It can be much easier with the assistance of a mortgage brokerand much safer than reading around websites to find the best offers, and it might save you a small fortune if you can take advantage of some free expert advice.

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