You and your mortgage: a guide for new customers

Congratulations! And thank you for choosing The Cambridge for your mortgage.

If you’re a new home owner hopefully it won’t be long before you can pick up the keys and settle into your new home. Or, if you've switched your mortgage to The Cambridge, you will shortly start to benefit from your new mortgage deal.

This guide will give you information about things you need to know – like your annual statement, what happens if your interest rate changes and how we can support you if you have difficulties with your monthly payments.

About your mortgage payment

Your mortgage payments will start soon after we send the mortgage amount to your conveyancer or solicitor. And will be collected by direct debit from your bank or building society account.

Your mortgage offer shows how much your monthly payments will be. But we'll write to shortly after your mortgage has started, confirming all the details. Your monthly payments are calculated based on full calendar months.

Initial interest

When your mortgage starts, we charge interest from the day we release the funds to your conveyancer or solicitor until the end of that month. This is called ‘initial interest’ and is a one-off charge.

Normally, this initial interest is added to your first full monthly mortgage payment. For example, if your mortgage payment date is the 1st of each month and your mortgage funds are released on November 4th, we’ll charge interest from November 4th to November 30th. This amount will then be collected along with your December mortgage payment on December 1st.

There are a few exceptions to this:

1) If your mortgage starts later in the month and your preferred payment date is early in the month, there may not be enough time to collect both your initial interest and regular monthly payment on your chosen payment date. In this case, we’ll collect both payments as soon as possible, usually approximately 14 days after the mortgage start date. Your mortgage payment will be collected on your preferred payment date the following month.

     For example: If your mortgage starts on 25th January and you wish to pay your mortgage on the 1st of each month, we’ll collect January’s initial interest amount and February’s mortgage payment around 11th February and will resume as normal the following month.

      2)  If your mortgage completes on the 1st of the month, there won’t be any initial interest to pay, it will be a normal mortgage payment. This will be collected as usual within the same month. If there is not enough time to collect on your preferred payment date, your payment will be collected as soon as possible. Your mortgage payment will be collected on your preferred payment date the following month.

     We will write to a few days after your mortgage starts confirming the payment amounts and dates.

How your interest is calculated

We calculate interest on the balance outstanding on your account at the end of each day. The interest is added to your loan at the end of each month. Every time you make a payment reducing the balance on your account, the daily interest is reduced.

Interest only mortgages

If any part of your mortgage is on an Interest Only basis please remember it’s your responsibility to ensure you have an appropriate repayment strategy in place and that it remains on track to repay the amount you’ve borrowed on Interest Only at the end of the term.

Making your mortgage payments

If you’d like to change your direct debit details or the date your mortgage payment is taken, just let us know. You can choose any date between the 1st and 28th day of the month to suit your budgeting. 

However, your first mortgage payment must be made using your current direct debits details and payment date, this can't be changed. After that, you can update your details by giving us a call or visiting us in store.

 

Additional payments

You can also make extra payments on most Cambridge mortgage accounts – please ask us or check your mortgage offer if you’re not sure. Making an extra payment reduces how much interest you pay over the long run and means you can clear the mortgage sooner.

There are two ways to make an extra payment. You can set up an additional monthly payment or you can pay a lump sum whenever you want. We’ll adjust your account balance on the day we receive the payment and your monthly payment may be recalculated following a lump sum payment.

Before making any overpayments please refer to your mortgage offer to check the terms and conditions of your mortgage. Early repayment charges may apply.

Take a look at our Mortgage Overpayments guide for more information. 

Helping you keep track

We’ll send you a statement annually, showing the mortgage balance at the end of the previous calendar year. It’ll show all the payments you’ve made and the interest rates. 

Online access

You can access your mortgage account information online. You’ll be able to see a summary of your account as well as your transaction history. Signing up is simple – just call us or visit your nearest branch and we can help you get set up.

Our guide tells you everything you need to know about getting online. 

Changes in your mortgage

If you have a variable or tracker mortgage, your monthly payments can go up or down. Following a change in your interest rate, your monthly payments will be adjusted accordingly and you'll be personally notified of your new monthly repayments.

Interest rates

Depending on the type of mortgage you’ve arranged, your interest rate may change.

If the interest rate is increased we'll let you know in writing, no later than 14 days after the change comes into effect to advise you of your new interest rate and payment.

Should the interest rate be reduced we'll let you know at the earliest opportunity.

At the end of your product term

At the end of your fixed or discounted deal your mortgage payment will change. But don’t worry, we'll contact you prior to your fixed, discounted or tracker term coming to an end to advise you of the options available to you.

If you choose not to move onto a new mortgage deal, your mortgage will transfer to a Residential or Buy to Let variable rate. 

Residential mortgages

Your mortgage will transfer to the Cambridge Variable Mortgage. You'll then pay our Standard Variable Rate and we’ll recalculate your payment for you.

Buy to Let mortgages

Your mortgage will transfer to a Buy to Let Variable Rate Mortgage. You'll then pay our Buy to Let Variable Rate and we’ll recalculate your payment for you.

Changes to terms and conditions

Occasionally we may change terms and conditions on your account. Please refer to the Terms and Conditions in your offer pack for further information.

Supporting you if things go wrong

We understand that circumstances can change over time, and that this could be out of your control. If something should happen which will affect you paying your mortgage, we’re here to support you. You can find more information here.

And here’s how you can make changes

Stay in touch

If any of your personal details change please remember to let us know so we can keep you informed about your mortgage and any other important information.

Life changes. And your Cambridge mortgage can change with you.

The great thing about borrowing with us is that we’re flexible so if you want to make a change to your mortgage just ask us and we’ll be happy to help.

Additional Borrowing

You may want to borrow more money, maybe for home improvements like a new kitchen, an extension or a garden makeover. Maybe you'll want something else, like a new car, that special holiday, school or university fees, or to pay off other loans.

Well, because you have a mortgage with The Cambridge, borrowing is more straightforward.

We can agree extra borrowing to suit your circumstances and, when the money has been paid to you, we'll adjust your monthly payment. A Solicitor may need to be instructed in some cases.

Before agreeing your new loan, we'll need to be satisfied that you can afford the payments. Your Mortgage Adviser will ask you to bring confirmation of your existing income and other outgoings.

Switching your mortgage

You may decide you want to take advantage of one of our different mortgage offers. And depending on the mortgage you have now, we can help you switch. Our Mortgage Advisers will be happy to talk it through with you.

For further information on switching your mortgage product take a look at our guide.

Selling your property

Of course, you can sell your property at any time, as long as you repay your loan when, or before, the sale is completed. There may be early repayment charges during the early years of your loan. Please refer to your mortgage offer to check the terms and conditions of your mortgage. We also have some helpful information on making changes to your mortgage online.

THINK CAREFULLY BEFORE SECURING OTHER DEBTS AGAINST YOUR HOME. YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE.