1. What is a mortgage?
A mortgage is a large loan to buy a property. The mortgage provider (a bank or building society) owns it until you’ve paid the whole loan back. If you can’t make your repayments, they have the right to repossess the property.
2. How much could you lend me?
This depends on your income, how much you have as a deposit and any existing debts you have. Ask our ‘How much could I borrow? ’ calculator to get an idea.
3. How much will it cost?
This depends on how much you borrow and how long it takes to repay your mortgage. Our repayment calculator will tell you.
You’ll have to pay other costs such as conveyancing, where a solicitor does all the legal paperwork. You should aim to budget around £1,500, on top of your deposit.
4. Can I use my own Solicitor?
Yes, you can – we recommend you shop around for the best deal. You can search The Law Society of Northern Ireland’s website for solicitors in your area.
5. How much deposit do I need?
We ask for at least 10% of the value of your property.
So if you want to buy a house worth £100,000, you’ll need to have £10,000 saved, and the provider will lend you the other £90,000.
6. What is Loan to Value?
‘Loan to Value’ or LTV is the ratio of your mortgage to the value of your property. So an LTV of 85% on a house worth £100,000 means that your mortgage will be £85,000. The other £15,000 is your ‘equity’ - the amount you actually own.
A lower LTV will usually mean a lower interest rate on your mortgage. Or to put it another way, the more you put down as a deposit, the less interest you’ll pay.
7. How long can I pay my mortgage for?
You can usually repay your first mortgage over as many as 40 years. This will keep your monthly repayments lower but you’ll also pay more interest in the long run. But you won’t be tied to this deal for all that time – you’re free to refresh your deal in as little as two years in some cases. It all depends on the terms and features of your first mortgage.
8. Fixed or variable - what should I do?
Don’t worry too much about this: your mortgage consultant will help you with this decision.
With a fixed rate mortgage the interest you’re charged is fixed for the length of the deal: at Danske Bank this could be anything from one to five years. The main benefit of this is that you’ll know how much your repayment will be for a fixed period of time, so if interest rates rise, your repayment will stay the same.
However, if interest rates fall, you won’t benefit from this. Usually if you want to end your fixed deal early you’ll have to pay a penalty.
With a variable rate mortgage your repayments can go up and down depending on interest rates, so if interest rates go down, your rate is likely to come down too. Another benefit is that you generally won’t be charged a penalty for repaying your mortgage early.
But of course, if interest rates rise, so could your repayments.
9. Are there conditions I have to meet?
For a start, you must be 18 or over. We will need to validate your income, you can read more about this by visiting our page – preparing for your mortgage meeting.
If you’re on a temporary or fixed-term contract, working through your probationary period or self-employed we may ask for additional information.
We’ll also consider any outstanding debt, and your credit rating. If you have outstanding loans or credit cards you may want to clear those first before applying.
10. How do I make a mortgage appointment?
Find out how in the ask us more section below.