In recent years, more and more domestic residents have come to live in the UK and are interested in buying their own property for reasons such as work, education and retirement. Buying a home in the UK generally requires a loan, but home loans in the UK are very different from those in China. Many people end up with problems because they are not familiar with the basic common sense of UK home loans or apply their domestic way of thinking to loans in the UK. Therefore, today's UK property editor will briefly introduce the basic common sense of UK home loans.
1. What is the maximum loan amount?
In the UK, there are two main types of home loans, namely homeowner mortgage loans and investment rental mortgage loans. It is important to note that the loan amounts for these two types of loans are different. The maximum loan amount for a homeowner's mortgage can be up to 95% of the total price of the home, while the maximum loan amount for an investment rental mortgage is 75% of the total price of the home.
2. Repayment options: principal and interest or interest only during the loan period
It is advisable for buyers to choose to repay interest only over the life of the loan, which is one of the most sensible options. As the interest rate is relatively low in the UK, buyers can use the funds for secondary investments such as insurance, overseas bonds, funds or financial products to increase their wealth accumulation.
3、Loan term
The term of the loan should be determined by the applicant's financial situation as well as the chosen loan bank and product. Generally speaking, the loan term is 25 to 35 years. The maximum loan term for common banks such as HSBC and Bank of China is 25 years and the applicant should not exceed the age of 75; while the maximum loan term for UOB is up to 35 years and the applicant should not exceed the retirement age, i.e. not more than 55 years old for women and 60 years old for men.
4. How far in advance do I need to start preparing for a loan?
To be on the safe side, UK property advisers recommend starting to prepare the necessary information for a home loan a year in advance, so that you have plenty of time to add to it if problems arise. When choosing a home loan, it is best to use the help of a loan broker to save time and effort.
So, with regard to the loan preparation period, it is important to contact a professional to prepare in advance, otherwise missing out on a stamp duty holiday is a small matter and delaying the purchase of a home is a big one.
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