Types of mortgages - Future Finance

Interest only mortgage

Your payment only covers the interest and none of the capital, which means that the amount that you have borrowed does not reduce. 

Repayment mortgage 

You repay both the capital (the money you have borrowed) and the interest charged on the sum outstanding.

This means you are paying more money out each month compared to an interest-only facility.

Buy-to-let mortgage

This is a mortgage taken on an investment property or property that you intend to rent out. The repayment method used for a buy to let mortgage can be either repayment or interest only. Lenders use the expected rental income and amount of deposit paid to calculate how much you can borrow.

Second mortgage / further advance

A second mortgage or loan is a facility that can be used for a multitude of purposes such as home improvements, purchases and consolidating credit. The facility would be secured on your property as a second charge and rank behind your primary mortgage provider.

Private mortgages

Private mortgages are often used for customers whose requirements or circumstances are bespoke. For example, if someone was self-employed and wanted to get a mortgage, a bank would require a minimum of three years' financial accounts to be available before they proceeded with the application. However, we take a commercial view and may only require one year's accounts, depending on the individual's situation. 

Private mortgages are, in principle, a legal agreement between two parties where one party agrees to lend the other one money. The lender is repaid the interest.

Short-term bridging finance 

A bridging loan is a type of a short-term loan that is typically taken out for a period of two weeks to three years, but can be longer. This form of finance is often taken out by those wanting to carry out refurbishment or are waiting for the sale of an asset. 

Development finance 

Development finance is for builders and developers, both big and small, looking at building or renovating residential and commercial property projects.

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