Glossary > The Letter R

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The Letter R
Saber Finance know the finance world is full of terms, phrases, buzz words and jargon.

On this page we explain,
Rate Surfing > Redemption Penalties > Re-mortgage > Removal Fees > Repayments > Repayment Mortgage > Right to Buy Mortgage

Rate Surfing
Rate surfing is one of the terms used when consumers actively seek cheaper deals and offers on financial products. Another less pleasant term used is rate whore.

Surfing for a Credit Card
One of the most common products customers surf for better rates on is credit cards. Transferring your balance to a credit card with a lower rate or waived period, can save you money and give you some financial breathing room.
Try the credit card best sellers, to find a cheaper or better rate.

Re-mortgaging and Rate Surfing
Another product that people frequently switch providers for is mortgages. Going to another mortgage lender that's offering lower interest is a easy, valid way for you making substantial savings.
The remortgage comparison directory lists lenders offering deals on re-mortgaging.

Redemption Penalties
Redemption penalties are a charge for repaying finance back early, that is before the term is expired. They are usually associated with mortgages or longer term loans. The lender agrees to lend some capital to the borrower for a set length of time. The repayments on this include calculations for interest, charges and arrangement fees. It is also worked out that the borrower is going to need a set number of months to pay it back.
The borrower on taking the credit agrees to make the repayments on time and to keep paying for the set term. If the borrower wants to pay off the debt early or seeks to change lenders they are breaking this agreement. They are also reducing the profit the lender was going to make on the agreement. To cover this a charge is made to cover for any lost costs and for the borrower breaking their agreement. The particular size of the redemption fee will vary between lenders.

Re-mortgage
A re-mortgage means switching the existing mortgage on a property for a new cheaper deal, often to a different mortgage lender or company. Re-mortgaging can also be used to free up equity on a property to create finance to be used elsewhere. Most borrowers currently pay their mortgage providers standard variable rate mortgage, and this is never the best deal out there. There is no reason to stop from switching mortgage lenders and re-mortgaging at a lower rate or for a more suitable deal.
Potentially a lot of money can be saved by a home re mortgage. You could have a new mortgage on your existing home either the same size and have lower repayments or make it bigger and have funds for home improvements or a holiday.
For those visitors interested in property re-mortgaging, there is a section on it.

Removal Fees
Removal fees are one of the easily forgotten costs of property buying or selling. Removal fees will have to be paid if a company is hired to help shift belongings and goods from one property to another. Moving into, or out off a property is one of the last stages of property buying or selling, and although the costs not great they are often overlooked.

Repayment
Repayments are the cost, usually monthly, to the holder of a finance product. When you borrow from a lender it has to be paid back. Once the lender has calculated the interest and fees charged on the sum you have borrowed, you will be presented with an over all cost. That figure is the cost of borrowing, you should notice you will pay back more than you borrow. Then once you have selected a length of term over which you need to pay back the credit, the overall cost is divided by that number of months. This is then your repayment amount, this pays back a portion of the capital and a portion of the interest charged.

Repayment Mortgage
A repayment mortgage is sometimes called a capital and interest mortgage. With this the entire mortgage, the capital and the interest, is paid back over the agreed period or term. When the mortgage's term has come to an end, providing all the repayments have been met, the property and its deeds will be in the hands of the homeowner.
The repayment mortgage gives you the peace of mind of knowing that once the final mortgage payment has been made you own the property and have no outstanding debt to pay to the lender.
If you are a UK resident and after mortgage lenders, try our mortgage search directory.

Right to Buy Mortgage
Right to buy mortgages are products specifically for use by public housing tenants who wish to purchase their property under the right to buy scheme. Public housing tenants are those tenants who rent their home from the local council, a housing association or a housing action trust. Right to buy mortgage products reward the tenant for their tenure with the landlord by giving a discount on the purchase price of the property. The discount offered is subject to different criteria including the tenants term in the property.
There will be terms and conditions attached to a right to buy and if holders decide to resell the property within a three year period, they may have to pay back some or all of the discount granted to their local authority.
After a mortgage to buy your home, search the mortgage best sellers to find a lender.

If you are in any doubt about any financial product or term we recommend that you seek advice from a financial advisor.

If you're after Finance Information, Saber Finance is here to help.