What Are Mortgage Terms? Everything UK Buyers Should Know

Landlords Property Market

Posted in Dec 19 , 2024

Planning to purchase a home in the UK? Before anything else, you must understand how a mortgage works, terms, and other questions. Mortgage terms refer to the time you agree to repay your loan and the specific conditions tied to your mortgage agreement, such as interest rates, repayment structure, and eligibility criteria. If you want to save money and make better decisions for your finances based on government reforms and economic changes, this blog is for you. Let’s start with:

What Are Mortgage Terms?

A mortgage term is the agreed-upon period during which the borrower repays the loan to the lender. In the UK, typical mortgage terms range between 10 and 40 years, with 25 years being the most common. A shorter term means higher monthly payments but lower overall interest costs, whereas a longer-term offers more manageable monthly payments but higher interest costs over time.

The Key Features of Mortgage Terms

Fixed-Rate vs. Variable-Rate Mortgages:

Fixed Rate: The interest rate remains constant for an agreed term (usually 2-5 years). It provides stability but may cost more if rates fall.
Variable Rate: The interest rate fluctuates with the Bank of England base rate. The examples include tracker mortgages and standard variable rates (SVR).

Loan-to-Value Ratio (LTV): The LTV determines how much of the property’s value you’re borrowing versus your deposit. For instance, a 95% LTV mortgage means you’re borrowing 95% of the home’s value and paying a 5% deposit.

Repayment vs. Interest-Only Mortgages:

Repayment Mortgages: Your monthly payments cover the interest and principal loan amount.
Interest-only mortgages: These are less common and typically for buy-to-let properties. Payments cover only the interest, leaving the principal to be repaid at the end of the term.

Mortgage Portability: Some mortgages allow you to transfer your loan to a new property if you move, saving early repayment charges.

Recent Changes in the UK Mortgage Market

The 2024 UK Budget introduced several updates that impact mortgage terms. Here’s what’s going to happen now:

The government is making its 95% loan-to-value scheme permanent. This scheme aims to help first-time buyers with small deposits and ensures lenders remain confident in offering high-LTV products.
Starting April 2025, the nil-rate band for first-time buyers will revert from £425,000 to £300,000. Home movers will also see a reduction, increasing buyers' costs. This investment, designed to build 33,000 affordable homes annually, could expand the housing options for first-time buyers.

Future Government Plans

The UK government has implemented various initiatives to make homeownership more accessible and affordable, especially for first-time buyers and those with smaller deposits. Here’s a closer look at the key plans and support systems in place:

Some lenders now offer special rates or incentives for energy-efficient homes to support the UK's carbon reduction goals. The government is working with lenders to promote these products, which could reduce buyers' costs and help the environment.
The government plans to collaborate with financial institutions to integrate green building standards and energy efficiency into mortgage products. This aligns with broader goals of sustainability and affordability for UK homebuyers.

Why Understanding Mortgage Terms Matters

Mortgage terms are more than just the length of your loan—they directly influence your financial stability, long-term costs, and homeownership experience. Here’s why every buyer should study them carefully:

Impact on Monthly Payments:

Shorter mortgage terms (10-15 years) have higher monthly payments but lower total interest, which can help you save money in the long run.
Longer terms (30-40 years) offer lower monthly payments but result in higher overall costs, suitable for buyers on tight budgets.

Interest Rate Sensitivity:

Fixed-rate mortgages provide stable payments but may start at slightly higher rates.
Variable-rate mortgages can save money when rates are low but may increase costs if rates rise.

Avoiding Financial Strain: Choosing the right term prevents financial strain and ensures your payments align with your income.

Eligibility and Long-Term Planning: Mortgage eligibility depends on age, employment, and credit history.

Early Repayment Flexibility: Many mortgages allow early repayment of overpayments, which can save you interest if you can pay off the loan faster.

Tips for Choosing the Right Mortgage Term

Finding the right mortgage term balances your financial goals, lifestyle, and long-term plans. Consider these tips when making your decision:

Calculate how much you can pay monthly without stretching your finances. Include costs like insurance and taxes.
Plan for future changes like career growth, starting a family, or retirement. Adjust terms to fit your evolving lifestyle.
Seek advice from mortgage brokers to compare options and understand complex terms and fees.
Explore government schemes like Help to Buy or Mortgage Guarantee for better rates.
Account for potential interest rate increases if choosing a variable rate.
Choose a flexible mortgage with options for overpayments or portability to adapt to life changes.

Why Choose Cribs Estates?

At Cribs Estates, we specialise in taking off all the workload from you and giving you the freedom to invest in the UK housing market. Here’s why we’re your ideal partner:

Our team simplifies mortgage terms, helping you find options that suit your financial situation.
We offer diverse property listings tailored to your needs and budget.
First-time buyers benefit from our guidance on government schemes and competitive mortgage deals.
With deep knowledge of the UK property market, we provide insights to support informed decisions.

Let Cribs Estates guide you every step of the way. Book a consultancy with us to start your journey towards homeownership today!

Shared on social media

Comments

Latest Blogs

Letting Agent Fees for Landlords Explained Simply

Letting fees can quickly become complicated if the percentages and a few extras do not match up exactly. For landlords living in the UK, this guide is a breakdown for both parties, so everyone knows what they are paying for. Let’s start by looking at what is working in the market and how you can keep more rent for yourself whilst staying as per UK rules. What are you actually paying for?Letting fees that landlords pay to agents are to find out the tenants or manage the tenancy. Following the Tenant Fees Act 2019, most fees to tenants were banned in England, leaving the bulk of charges to be borne by the landlord. The three common service levels 1) Tenant-findingThe agent markets the property, handles enquiries and viewings, references tenants, completes Right to Rent checks, prepares the tenancy agreement, takes the first rent and deposit, and hands over keys. Ongoing management is over to you. Right to Rent checks are a legal must, with updated Home Office guidance in 2025.2) Rent CollectionEverything in Let Only, plus the agent collects monthly rent, chases arrears, and produces statements. You still manage repairs.3) Fully ManagedThe agents are responsible for complete management, including maintenance coordination, compliance scheduling (gas safety, EICR, EPC), inspections, renewals, deposit dispute handling, and serving notices where required. The average fee for this service in the UK is around 10–15% of monthly rent (before VAT), depending on location and complexity. What influences the fee?There are multiple factors, including:Prime London and HMOs usually cost more to manage.HMOs/room-lets involve more tenants, bills, and safety checks.Photos, floor plans, portal coverage, inspections, out-of-hours, deposit dispute handling, and compliance reminders all add up to more fees.Inventory, check-in/out, legal notices, and certificate costs also add up. How do agents calculate fees?Agents can either charge a percentage of rent or a fixed fee. Market norms for fully managed services typically range from 10–15% plus VAT. To better understand this calculation, here’s an example using a London rent:Monthly rent: £1,800Fully managed fee at 12% = £216VAT at 20% = £43.20Total monthly fee = £259.20Annual cost = £3,110.40If you chose a let-only service at 7% of the first year’s rent on the same property:Annual rent: £21,6007% fee = £1,512VAT = £302.40One-off total = £1,814.40The legal guardrails that affect feesTenant Fees Act 2019: bans most tenant charges and caps deposits; landlords should expect to bear the legitimate costs of letting.Right to Rent checks: Landlords (or their agents) must verify prospective tenants’ right to rent; guidance was updated in June–July 2025.How Cribs Estate is helping landlordsCribs Estate has been working locally in the UK for over a decade now, helping landlords with complete letting management. They have a clear and affordable fee structure with 3 tiers for the landlords:Let Only: 7% (plus VAT): marketing across major portals and social channels, professional photos/floor plan/virtual tour, viewings, referencing (via reputable agencies), Right to Rent, AST signing, first rent and deposit handling, and handover.Rent Collection: 9% (plus VAT): everything in Let Only plus monthly rent collection, arrears chasing, statements, and renewals.Fully Managed: 12% (plus VAT): all of the above plus repairs coordination, compliance scheduling (Gas Safety, EICR, EPC, PAT), periodic inspections (typically 6–12 months), deposit disputes, guidance on serving notices, and general legislative updates.Cribs also charges separately for other services, such as HMO licence application preparation, legal notices (Section 8/21), inventory check-in, and certificate costs, with a note that all fees are subject to 20% VAT. This lets you budget correctly and avoid surprises.Should landlords choose agents?Yes! As a landlord, it is mandatory these days to get agents to work for you, whilst you can focus on building your portfolio. Moreover, it helps with:Getting the marketing done in the right direction to minimise void times.Ensuring all properties comply with relevant regulations, including Gas, Safety, EICR, and EPC, to avoid any issues.Maintaining the property in the right way involves obtaining all necessary approvals, conducting inspections, generating reports, renewing licenses, and making deposits. Obtaining a tailored HMO management service that guarantees rent every month.Contact Cribs Estate to discuss a plan with affordable letting agent fees tailored to your property's needs.

Landlord Rent Guarantee UK: How It Works

If you’re a landlord seeking predictable income with minimal late payments, voids, or daily management, a landlord rent guarantee can be a smart option. Most landlords in the UK are unfamiliar with the right approach or don’t believe they are qualified. However, if they want to understand the costs and which trade-offs truly matter, our team at Cribs Estate has researched to save you the effort. Let’s begin!What is a landlord rent guarantee?A landlord rent guarantee means you receive a fixed monthly rent for an agreed term (often 1–5 years), regardless of whether the property is empty or a tenant falls into arrears. Instead of relying on the tenant to pay you directly, you’re paid by the company operating the scheme (for example, Cribs Estate) under a contract. In most setups, the operator then handles tenant sourcing, day-to-day management, and compliance.This is different from rent guarantee insurance, which is a policy that covers missed rent from a specific tenant and usually requires you to manage the claim process. With a guarantee, you’re paid a fixed sum each month as per the contract, no claims and no chasing.How it works (step by step)Property assessment: We conduct a quick inspection to confirm the location, market rent, condition, and any necessary works to meet standards.Offer & terms: You receive a written offer with the monthly guaranteed rent, term length, break clauses, and responsibilities.Onboarding & compliance: Safety certificates (EPC, EICR, gas safety), licensing checks, and inventory are organised.Management & letting: We market and manage the tenancy (or use a company let/licence model).Monthly payments: You’re paid the agreed amount on the same date each month, even during voids.Ongoing care: Inspections, maintenance authorisations, renewals, and compliance are handled within agreed limits.End of term: Property is handed back in line with the contract, with any agreed-upon ending of the contract (if it happens).Common UK letting modelsAgency-managed guarantee: A letting/management firm guarantees the rent and handles everything end-to-end.Company let / master-lease: The agent becomes your tenant under a commercial agreement, then houses occupants under sub-tenancies or licences.Local authorities: Longer terms and reliable occupancy, often with specific property standards.Who qualifies (and property standards)Most houses and flats can qualify if they’re safe, legally compliant, and in lettable condition. Expect the following as baseline:Valid gas safety, EICR, working alarms, and EPC meeting current requirements.HMO, additional or selective licensing where applicable (we’ll advise what’s needed).Clean, sound décor, compliant kitchens/bathrooms, and no outstanding hazards.Reasonable access for inspections and upkeep.Costs, fees, and what you keepYou’ll usually earn slightly less than headline market rent in exchange for zero voids, no arrears risk, and complete management included. The simple way to view it:Open market: £1,800 pcm with a realistic one-month void per year, which means effective £1,650 pcm.A 10% management fee is deducted from the collected rent (£165), which is £1,485 pcm.Average remarketing/churn (£500 per year, which is £41.67 pcm), and makes the total £1,443 pcm net before maintenance.Guaranteed rent: e.g., £1,500 pcm paid every month, no voids, management included.Benefits of Landlord Rent GuaranteeCashflow stays steady whilst interest rates and bills may fluctuate.Payments arrive even if the property is empty.Handling marketing, viewings, referencing, renewals, inspections, etc.Guidance and admin for certificates and licensing.One payment date and one statement across multiple units.How Cribs Estate delivers guaranteed rent (and peace of mind)At Cribs Estate, our guarantee is built to be clear, fair, and easy to live with:Fixed monthly payments on a set date, no voids, no chasing.Complete management included: marketing, referencing, move-ins, renewals, inspections, and out-of-hours issues.Straightforward contracts with transparent responsibilities for both minor and major works, along with pre-agreed spend limits.We organise or remind you of EPC, EICR, gas safety, and licensing, and we keep an audit trail.Regular inspections, photographic reports, and end-of-term hand-back conditions.Single statements, KPIs, and a point of contact, ideal for UK-based landlords.FAQs about Landlord Rent Guarantee1. Will I lose control of the property?No. You remain the owner. Access, approvals for larger works, and hand-back standards are set out in the contract.2. Who pays for repairs?Minor day-to-day fixes are usually covered within agreed limits. Bigger works remain the landlord’s responsibility, just as they would under a normal tenancy, only now they’re managed for you and pre-approved.3. What about utilities and council tax?It depends on the model and whether it’s a single let or HMO. We spell out who pays what for your specific property so there are no surprises.Next stepsThinking about a guarantee for your property or portfolio? We’ll carry out a quick assessment, confirm compliance steps, and provide a no-obligation guaranteed rent offer with clear terms so that you can compare it to open-market management. Get in touch with Cribs Estate, and let’s see whether a landlord rent guarantee is the right fit for your goals.

Cribs Estates- The Best Landlord Services Near Me

Are you trying to get reliable local landlord services? Particularly when it comes to renters, rent, and maintenance, property management can be very stressful across the UK. However, Cribs Estates can assist you in a professional way. To make property administration easy and stress-free, we offer reputable and competent landlord services. Our knowledgeable staff makes sure your home is in good hands by managing everyday problems and locating the ideal tenants. You can see how our landlord services can improve your investment returns and provide you with peace of mind by reading this short blog.Cribs Estates Services for LandlordsIn order to make property management easy, stress-free, and lucrative, Cribs Estates offers comprehensive landlord services. The main services we provide are listed in detail below:Sourcing TenantsOne of the most crucial aspects of property management is selecting the ideal tenant. We handle setting up viewings, promoting your property on reliable websites, and drawing in desirable tenants. Our objective is to ensure that your property is rented by responsible people while reducing vacancy times.Referencing TenantsWe thoroughly screen each potential tenant to provide you peace of mind. Credit checks, work references, background checks, and rental history reviews are all included in this. We make sure that only trustworthy tenants are accepted for your home through this procedure.Rent ReceivableTenants are guaranteed to pay on time each month thanks to our rent collection service. We manage the procedure safely and ensure that money reaches your account promptly, providing you with a consistent and reliable source of income.Maintenance of the PropertyWe handle everything, from minor fixes to more extensive maintenance duties. Our staff makes sure your property stays in top shape while maintaining tenant satisfaction, whether that means repairing a leaking tap, scheduling routine cleaning, or managing urgent repairs.Inspections of PropertiesTo assess the general condition of your property, we perform routine property inspections. This guarantees that tenants are taking care of the house and helps spot possible problems early. You are constantly informed about the condition of your property thanks to the thorough inspection reports you receive.Adherence to the LawIt can be quite difficult to stay on top of safety rules and property restrictions. Our staff ensures that your property satisfies all legal criteria, such as electrical certificates, fire safety regulations, and gas safety inspections. You and your tenants are both protected by this.Tenancy ContractsWe draft tenancy agreements that are legally valid and specify the obligations of the landlord and the tenant. These agreements are intended to safeguard your rights, lessen disagreements, and give everyone involved clarity.Why Choose Cribs Estates for Local Landlord Services?Choosing local landlord services can have a significant impact on property management. A local staff can react swiftly to any concerns that arise because they are familiar with the area and the rental market. Your property remains profitable, stress-free, and well-managed with the correct assistance.Cribs Estates feels that basic management is insufficient for landlords. Our strategy is based on dependability, professionalism, and openness. Cribs Estates is a reputable option when individuals look for landlord services near me because of this. We combine years of experience with local expertise to provide you with the best possible outcomes.Local expertise and knowledgeCustomised service plans to meet your requirementsFair and reasonably priced prices24/7 supportNice Customer ServiceProfessional online instructorsContact Cribs Estates Right NowAre you prepared to simplify and relieve the stress of property management? For dependable landlord services in your area, contact Cribs Estates right now. We are here to safeguard your investment and provide you with peace of mind with our local knowledge, customised packages, reasonable prices, and round-the-clock assistance.

Fully Managed Letting Service for Busy Landlords

As a landlord, if you are already juggling work, family, and properties, the last thing you would want is late-night calls about boilers not working. Apart from this, you may worry about whether your tenancy agreement meets the new standards. That’s where a fully managed letting service takes charge and comes to the rescue of landlords. This blog talks about what fully managed services cover and why they’re the wise choice for landlords. What “fully managed” really meansIt means that a reliable company will manage everything for you, including professional marketing, tenant background checking, collecting rents, setting up legal compliance reports, deposit protection, inspections, maintenance, renewals, and check-out. As a reliable partner, Cribs Estate assists UK landlords in maintaining compliance with statutory dates, including gas safety, electricity checks (EICR), EPC, and Right to Rent, while also managing local property trades to ensure readiness for any emergency. Why busy landlords choose fully managed lettingNo chasing contractors, no phone tag with tenants, no diary reminders for certificates.Issues get triaged and resolved; you approve costs above the agreed limits.Proper referencing, legal notices, and deposit protection reduce nasty surprises.Rent in, statements out, inspections logged, so you always know where you stand.Clear communication with tenants, which helps with renewals and reduces voids.How Cribs Estate does management in LondonWe have been operating locally in SW19 for the past decade, which is why we keep landlords in the loop about every move. Our experts conduct proactive compliance checks, oversee maintenance, and address any needs tenants may have before they settle in. We have a dedicated team available 24/7 for any urgency, so you don’t have to destroy your health and stay awake in the middle of the night to get things done. Another reason clients trust our services is the proper tracking of where the money is going. We ensure all the money is protected via UKALA CMP, as we are part of the approved Property Redress Scheme, and the deposits are registered with government-approved schemes, including DPS and mydeposits. This gives peace of mind to all tenants and works as a wonder for the landlords. What’s included vs what it costsCribs Estate offers clear plans so you can choose the level that fits your life:Let Only: marketing, viewings, referencing, and move-in.Rent Collection: as above, plus monthly collection and statements.Full Management: the above plus maintenance handling, scheduled inspections, renewals, compliance tracking, and deposit dispute support.As our landlord fees are published on the website, our structure lists Let Only (7%), Rent Collection (9%), and Full Management (12%) (plus VAT), with a transparent menu of extras for things like HMO licence applications, serving Section 21/8 notices, and safety certificates. You’ll see exactly what you’re paying for before you commit.Who gets the most value from fully managed?First-time or accidental landlords seeking a safe, compliant start without relying on Google.Time-poor professionals who’d rather keep weekends for family than fixes.Portfolio owners who seek consistent reporting and fewer moving parts.Overseas/expat landlords who need reliable eyes and ears on the ground, in the right time zone.HMO landlords seeking strict compliance and steady occupancy (Cribs is hands-on with licensing, safety, and tenant mix across South-West London).If you own (or plan to own) an HMOHMOs can boost yield, but they also require more work on the administrative side. We assist with obtaining the correct licence (mandatory/additional/selective, depending on the borough), installing the appropriate fire doors and alarms, monitoring safety testing, and maintaining rooms with an optimal tenant mix. We cover areas including Wimbledon, Colliers Wood, Tooting, Balham, Morden, Mitcham, and more. If you’re weighing up a conversion, we’ll give you straight-talking advice on feasibility and returns.The Cribs Estate letting journeyWe advise on rent, presentation, and any kind of work that will pay back.Professional photos and listings on our website and across major portals and social media platforms help attract more viewings.A proper system is in place for checks, deposits are taken and protected, the AST is signed, and keys are handed over.We collect rent, book inspections, handle maintenance, and renew certificates on time.We negotiate renewals or remarket faster than others to keep you on track.Is fully managed worth it?If your time is valuable, the answer is usually yes. Faster leases, better tenant retention, and fewer compliance missteps often offset the fee. And if you want belt-and-braces predictability, a rent guarantee can smooth the bumps. If you're looking for a fully managed letting service that’s easy to handle, offers a single point of contact for all your needs, and ensures proper compliance, we’d be delighted to assist you. Book a free valuation, or simply message us with what’s happening with your property, and we’ll take it from there.

Property search

Residential Lettings

Residential Sales

HMO

Commercial Sales Commercial Lettings

Price

Min price

Max price

Number of Bedrooms

Min bedrooms

Max bedrooms

Find properties