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The Truth Behind Low Mortgage Rate Offers
 A low mortgage rate is a very lucrative option sought by potential borrowers in the quest for a loan that does not burden their finances too much. Lenders lose on their profits on loans with low mortgage rates and therefore approve such rates only in case of a low risk mortgage. From among the various types on mortgages, fixed rate loans and variable rate loans have the potential to give the benefit of low rates. While the fixed rate loan rarely starts at low interest rates, it can eventually prove to be one in case the rates fall within the life of the mortgage. A variable rate mortgage interest rises and falls with the market rates. Therefore if initial rates are low, the mortgage remains competitive with changes in the base interest rate structure. However, a low interest rate loan needs to be approached with caution. Lenders have come to understand that the general borrower is primarily attracted by advertised low interest rates and has little or no consideration for the overall package. Having identified this trait, lenders are designing packages that apparently offer quite low rates but in fact are saddled with very high setup fees that may be in thousands of dollars. Others carry upfront costs as a percentage of the loan amount as high as 3.5 percent. A borrower merely looking at a low mortgage rate gets duped being unable to focus on the actual consequences of such a large processing fee. Borrowers would be well advised to first shop around and do their homework before signing to ascertain if the low rates justify the imposition of the large mortgage loan processing costs and actually result in savings for them. If they don't, its better to refrain from going ahead. Or at least not to consider it as a low cost option. Mortgages are generally regulated by the Financial services Authority barring certain exceptions that include buy-to-let mortgages and commercial mortgages etc. Even when it is lenders, who are allowed to ultimately decide the different interest rates for mortgages they offer, they have to maintain the rates within the range prescribed by the state. Lenders usually offer low interest rate loans in a staggered way; for example, for a 25 year mortgage: Initial Interest Rate - 2.25 percent fixed -1st May 2007 onwards up to 31st March 2009' Changing to SVR (standard variable rate) for the balance of the term (presently 7.34 percent) In this case the overall APR (annual percentage rate) on cost comparison would be 6.7 percent. Your eligibility for a low rate mortgage greatly depends on your credit rating also. So you need to do a bit of research to locate a low mortgage rate lender and work on improving to/maintaining a perfect credit rating. There is never a bad time to invest in property. Historically, property has always risen in price regardless of any short term trends. Let Mortgages Limited has exclusive access to the best deals for investors who wish to grow their portfolio fast and at the minimum cost. Check out our No Proof Of Rental Income Required Buy To Let Mortgages & for those who are able to negotiate a 15% discount a 15% Builders Deposit Buy To Let Mortgages or 15% gifted deposit will allow you to purchase without using your own funds! "For A 100% FREE Consultation
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