Choosing the right mortgage product can, at first sight, seem daunting. After all, dozens of lenders offer hundreds of mortgage products. So, how do you choose the right mortgage for you?

This is important because if you have the wrong mortgage, changing it can be expensive and take time. This guide will help to explain how each type of mortgage works, and help you to choose the right one for you.

HM Treasury has laid down specific standards that must apply in order to meet its CAT (Charges, Access and Terms) standards. You might expect such mortgages to be cheaper or better, but that is not necessarily the case.

Mortgage interest is either fixed or variable. Variable simply means that the lender can change it – usually at a few days’ notice.

Whether you should choose fixed or variable rate depends on three factors:

• The rate available on each.
• Whether you think rates will go up or down (unfortunately, no one knows for certain, so there is always a risk that rates will move in a way that you or even the best experts did not expect).
• How tight your budgeting is. If you have borrowed as much as you possibly can, any rise in monthly payments could cause major problems.

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