This page provides information on some of the key aspects of taking a mortgage with esbs.

Of course, we are always on hand to help should you require clarification of any of the following and we would be happy to answer any other questions that you may have.

Who will your mortgage be provided by?Earl Shilton Building Society
22 The Hollow
Earl Shilton
LE9 7NBTel: 01455 844422
What is suitable security for your mortgage and what can be the purpose for having a mortgage with us?Your mortgage will be a first charge secured against your property, and can be used for buying your home (house, flat, maisonette) or land in England and Wales, to help build or improve your home, to refinance an existing mortgage arrangement (remortgage), or to capital raise for other purposes.

All of the above will be subject to meeting the Society’s Standard Mortgage Terms and Conditions, as well as product specific terms and conditions and our current lending criteria.

How do we assess your security?The Society requires a valuation of the property and land. There are two main ways in which we do this:

  • Mortgage Valuation – This is a limited report for the Society’s purpose and is not a survey. It is a comment on the general condition of the property and whether it provides suitable security for a mortgage. It is prepared for the Society and as such should not be relied upon by the Applicants as a report on the condition.
  • RICS Home Buyers Report and Valuation – This provides a more detailed inspection providing information on the state of repair and the condition of the property. You will receive a report from the Valuer with details of his inspection and opinion of the current market value. The Valuer will also complete a report for esbs.

The fees for this are detailed here – Valuation Fees – Current

How long do our mortgages last for?Our minimum mortgage term is 5 years and our maximum term is 40 years. Individual circumstances may mean that your term may need to be longer than the minimum term and/or shorter than the maximum term.

You can, however, repay your mortgage early at any time, although it may be subject to an Early Repayment Charge. The length of the Early Repayment Charge period, and the amount of the charge, will be specified in the individual product details, and in any personalised illustration (See ESIS).

Capital repayments and overpayments are permitted subject to a maximum of 20% per financial year of the amount advanced or transferred capital balance. Capital repayments are subject to a minimum of £1,000 over the normal monthly payment.

What are our current mortgage borrowing rates?The Society only offers variable rate discounts. This method allows you to benefit from a discount from our Standard Variable Rate (SVR). Should our SVR increase or decrease, so does the discounted rate you pay. At the end of the discount period the rate will change to the current SVR rate at the time.

Current products are listed within each mortgage category.

Some existing borrowers may have benefitted from a Tracker Rate. This type of product is a rate linked to the Bank of England bank rate, which means the rate charged will change in line with any change in the Bank of England bank rate. Tracker rates are not available to new customers.

What is a representative example of the total amount of credit, the total cost to a borrower, the total amount payable and the ARPC?Prior to taking a mortgage with the Society, you will always be provided with a personalised illustration (see ESIS) which provides this information, bespoke to your individual circumstances.
What other possible costs are there?Costs related to a representative mortgage will be shown in the representative examples detailed in the individual product pages.

Other costs could include:

  • Electronic transfer of funds £30
  • Deeds Release Fee £50
  • Sealing Fee £100
  • Estimated legal costs in conjunction with a mortgage and estimated Valuation Fee
  • Higher Lending Charge

Should these costs be applicable to your own mortgage then they will be detailed in your personalised illustration (see ESIS).

In addition there are other fees that may be applied during the lifetime of your mortgage and the current list of fees can be found here –Administration Fees – Current

What options are available to you to repay your mortgage?The Society has two options available for repaying your mortgage:

  • Capital and Interest Repayment type – With this type of mortgage, you repay part of the amount borrowed together with the interest being charged each month. Subject to there not being any changes in the interest rate charged, it is designed so that the same repayment amount is made each month. In the earlier years of your mortgage, the largest part of your monthly repayment is made up of interest. However, towards the latter part of your mortgage term, this changes and the majority of your monthly repayment will be the repayment of the amount borrowed.

As well as the interest charged, the length of the term will dictate the amount of the monthly repayment; the shorter the term, the higher the repayment as the capital will need to be repaid quicker.

  • Interest Only – With interest only you are only paying interest each month. This means that, although your payments will be lower, you are not repaying any of the capital borrowed each month so the amount you borrow will still be outstanding at the end of the mortgage term. You will need to therefore have credible arrangements in place to pay off the mortgage at the end of the term.

Before agreeing to your mortgage being on an Interest Only basis, we would require evidence of how the capital will be repaid at the end of the term. We would also ask you to sign a declaration confirming the arrangements. Throughout the lifetime of the mortgage we would contact you to remind you that the capital will need to be repaid at the end of the term. We also may have you sign further declarations, and provide further evidence, that the repayment strategy remains in place.

The maximum loan to value the Society will consider for an Interest Only mortgage is 75%. If the loan to value is higher than this, then the remainder would be on a capital and interest repayment basis.

The Society will collect your repayment by Direct Debit on a monthly basis. The number of repayments will be defined by the term of the mortgage. A representative term and number of repayments will be shown in the representative examples detailed in the individual product pages. The exact term and number of repayments applicable to your own mortgage will be detailed in your personalised illustration (see ESIS).

Capital repayments and overpayments are permitted subject to a maximum of 20% per financial year of the amount advanced or transferred capital balance. Capital repayments are subject to a minimum of £1,000 over the normal monthly repayment.

Do you need to take any other products with us as a condition of the mortgage being granted?No, we will not insist that you take another product with the Society as a condition of the mortgage being granted.

However, we will require the buildings to be insured for a sum insured of at least the figure recommended by our Valuer.

What is a European Standardised Information Sheet (ESIS)?This is a pre-contractual disclosure document which must be given to you prior to taking a mortgage with us. The ESIS allows you to compare credit products available from both a single provider and also across the market. This means you can assess their implications and make an informed decision on whether to proceed.
What is Annual Percentage Rate of Charge (APRC)?The APRC is the total cost of the credit to you, expressed as an annual percentage of the total amount of credit, including all applicable costs relating to the mortgage and equates, on an annual basis, to the present value of all future or existing commitments (drawdowns, repayments and charges) agreed, or which would be agreed if the Mortgage agreement is entered into.

However, where the borrowing rate or charges payable may vary, you will need to be informed of the possible impact that any variation may have on the total amount which may need to be paid by you. This is shown by way of a second APRC in a representative example.

This second APRC is calculated using the highest borrowing rate over the previous 20 years.

What are the consequences for borrowers who do not comply with their commitments linked to the mortgage?We will provide you with a booklet of the terms and conditions relating to the mortgage. This will provide further information on your obligations under the contract.

We would particularly highlight that failing to meet the required payments (or to make such payments on time) may mean further costs where this results in further work for us.

Continuing to miss payments or increase your debts under the contract may ultimately lead us to take action to repossess.

You are also obliged to keep the property in good condition and to have appropriate buildings insurance. Failing to do either may cause us to take action on your behalf (e.g. to insure the property) and you will be liable for our costs should we need to do this.

If you fail to make your payments then this information will be passed to credit reference agencies, which may impact on your ability to take out further loans.

Should you encounter difficulties in making your monthly payments, please contact us straight away to explore possible solutions.

As a last resort, your home may be repossessed if you do not keep up with payments.

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