Most first-time buyer mortgages are repayment loans, where your monthly payments are used to pay off any debt you owe until you eventually own your home outright. You’ll usually be offered a fixed or variable rate mortgage.
A fixed-rate mortgage will keep your monthly mortgage repayments set at a rate for two, three or five years – although in some cases, you can fix it for as long as 10 years.
A variable rate mortgage doesn’t have a fixed interest rate. Instead, interest payments will be adjusted at a level above a specific benchmark or reference rate. Variable rate deals typically fall into three main categories: standard variable rates, tracker rates and discounted rates.