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Personal loan or mortgage?

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  • Personal loan or mortgage?

    Just short of £25K to buy a repo. Should I apply for a loan or mortgage? Interest on loan is 6.99% fixed for 2,3,5 years whilst mortgage is 3.45% for 2 year fixed or 3.99% for a 5 year fixed and its fee-free with HSBC?
    What is your advice?
    Ta.

  • #2
    Re: Personal loan or mortgage?

    Mortgages are traditionally cheaper than loans. The interest rate for a loan you quoted is double the mortgage interest, for example

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    • #3
      Re: Personal loan or mortgage?

      Thanks Brian! A member of staff from the bank and the financial advisor advised that I take out a loan. But when I worked out the sums, it cost less in money and stress to go for a mortgage.
      You're the best!

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      • #4
        Re: Personal loan or mortgage?

        Everyone has different needs. You may hate the idea of monthly loan fees. Or you may think a few dollars a month is fine – but only if you can pay extra funds into your loan and take them out when you need them at no extra cost. You may want the option of moving to a fixed interest rate down the track. Or you may want to buy as much house as you can possibly afford, even if that means a low-flexibility no-frills loan.
        Deciding which of these options suits you is one of the hardest things about taking out a home loan. (eChoice's application process, its telephone consultants and its home loan managers can help you sort out your priorities.)

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        • #5
          Re: Personal loan or mortgage?

          Of course, this is a UK forum, not an American one, and so even though there may be some similarities between mortgages and "home loans", there will be any number of differences too.

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          • #6
            Re: Personal loan or mortgage?

            Originally posted by Jeannie D View Post
            Of course, this is a UK forum, not an American one, and so even though there may be some similarities between mortgages and "home loans", there will be any number of differences too.
            I agree with you Jeannie

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