A mortgage is a loan you take out to buy a property. You borrow the money from a mortgage lender, but the lender doesn’t own your home. You do.

To get a mortgage, you’ll need a large upfront payment, called a deposit.

A mortgage can last between 5 and 40 years. The number of years you take to pay back your loan is called your mortgage term.

What is a repayment mortgage?

With a repayment mortgage, your monthly payment is made up of principal and interest.


The principal is the amount you borrowed and have to pay back, and interest is what the lender charges for lending you the money.


Every month, you pay an amount of the debt itself (the principal) and the interest as well.


Month on month, your balance (the amount left on your loan) will go down and by the end of your term, you’ll have repaid the loan in full.

How to pay less interest

There are three ways to pay less interest: bigger deposit, shorter mortgage term and making overpayments.


If you can put down more deposit, you’ll qualify for lower interest rates.


A shorter mortgage term means bigger monthly payments, but it also means you’re paying off the loan faster (and therefore, paying less interest). An advisor will help you work out the best term for you.


Overpayments are extra payments you make towards your mortgage.

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