Residential mortgages are loans taken out to purchase or refinance a home or other residential property. They are a common way for individuals to buy homes without having to pay the full purchase price upfront. Here’s a breakdown of key aspects:

Types of Residential Mortgages:

1. • Fixed-Rate Mortgages: The interest rate remains constant throughout the term of the loan. This offers predictable monthly payments and stability against interest rate fluctuations.
   • Variable-Rate Mortgages: The interest rate can change over time based on market conditions or a specific index. This can lead to lower initial rates but comes with the risk of payments increasing if rates rise.
   • Interest-Only Mortgages: For a set period, you only pay the interest on the loan, not the principal. This results in lower monthly payments initially but higher payments later when you start repaying the principal.
   • Discount Mortgages: These offer a discount off the lender’s standard variable rate for a set period, which can lower monthly payments initially but may increase after the discount period ends.

   Mortgage Terms:

   • The term of a mortgage is the length of time you have to repay the loan, commonly 15, 20, or 30 years. Longer terms typically mean lower monthly payments but more interest paid over the life of the loan.

   Down Payment/ Deposit:

   • A down payment is an upfront payment made towards the purchase price of the property. It is usually a percentage of the property’s value. Larger down payments can reduce the size of the mortgage and may lead to better interest rates.