A mortgage is simply a loan specially designed to help you buy a house. It’s technical term is a secured loan, a term you will hear often. This means that the money you borrow is attached against an asset, in this case it is the bricks and mortar of your property. This means that if you fail to pay the monthly mortgage payments the lender can take possession of the property and sell it to clear the loan amount you have borrowed.
Also known as a 1st charge, a mortgage lender will legally register their secured loan on the property on the land registry. Land registry is a database of who owns what property and land throughout the country. You will then be given what is known as the title deeds for the property you buy, which is a document that proves you own the property and in this case that the mortgage lender has an interest in the property as well.
A mortgage loan is offered by banks and building societies, many of whom you will know, but there are also a lot of banks and building societies that you may not know. This may be because you do not have a local branch or the bank has only been set up to offer mortgages. There are also what is known as High street lenders, usually banks like, Halifax, Nationwide, Natwest and none-main stream lenders, who are usually targeting clients who are no accepted by the High street lender because of bad credit, or other issues. It’s a good idea not to ignore lenders that you haven’t heard of because it doesn’t necessarily mean that they won’t be right for you.