Mortgages

A mortgage is an unsecured loan used to buy a home or a flat?

• True
• False

The normal _______ for a mortgage is up to 30 years

• Term
• Interest Rate
• Principle
• Loan

With this type of mortgage the borrower puts money aside each month into some form of investment, so that they can repay the capital at the end of the mortgage term 

• Repayment
• Interest Only
• Offset

The most straightforward type of mortgage where the monthly repayments go towards both the capital and the interest

• Offset
• Interest Only
• Repayment

A mortgage where you can use your savings to reduce the amount of interest that you have to pay 

• Repayment
• Interest Only
• Offset

In the early years of repaying a 30-year repayment mortgage,

• equal amounts go towards repaying the principal and interest.
• most of the payment goes towards repaying the principal.
• most of the payment goes towards repaying the interest.

What is usually the maximum amount that a mortgage lender will allow an individual to borrow?

• 3 times annual salary
• 6 times annual salary
• 4.5 times annual salary
• The price of the property

The size of the loan in relation to the value of the property being purchased is known as the,

• Mortgage to Price Ratio
• Loan to Value Ratio
• Loan to Repayment Ratio
• Loan to Salary Ratio

The higher the loan to value ratio, the ________ it is deemed to be by the mortgage lender

• safer
• riskier

What is the loan to value ratio, if the borrower requires a mortgage of £150,000 against a property valued at £200,000

• 50%
• 80%
• 75%
• 100%