What is a Mortgage?

A mortgage is a loan, usually from a bank, finance company or building society to help you buy your home.

A mortgage is a loan, from a bank or building society that is secured against your house or flat. You have to pay back everything you borrow from your lender within an agreed length of time (the mortgage term). You also have to pay interest on what you have borrowed.

A mortgage is a loan you take out to buy property. Most banks and building societies offer mortgages, as well as specialist mortgage lending companies.



To repay the mortgage you either make monthly repayments of interest and capital, or you pay interest only each month then repay the loan at the end of the mortgage term from separate savings or investments.

The purpose of a mortgage is, quite simply, to enable a person to borrow money using the property as security. As the prices of houses are beyond the immediate personal resources of most purchasers, it is necessary to enter into a borrowing agreement with a lender.



A mortgage is therefore a form of a secured loan, whereby the lender agrees to lend a person the money to enable them to purchase a property. This loan is secured against the property by a legal charge and is subject to the purchaser and the property being able to meet the lender's criteria. This loan is then paid back over a period of time along with the interest charged by the lender.

In most cases lenders will offer three times a single person's salary or two-and-a-half times the borrowers' joint salaries.



However you should consider whether your budget can afford the repayments before borrowing to the hilt.

A mortgage is a long term financial commitment with repayments typically spread over a term of up to 25 years. However in practice, people often sell their house before the end of the mortgage period. The original loan is then repaid from the sale of the first house and a new loan is taken out to buy the new home.

Each joint borrower is individually liable for the amount of the loan and interest due to the lender and is always responsible for the full amount outstanding.



Events such as separation, divorce, unemployment, long term sickness, injury or disability could ultimately cause a house to be sold and the mortgage to be terminated. The early repayment of a loan can have different financial consequences depending on the type of mortgage involved.

Most mortgage lenders also require you to have a suitable life assurance policy, which would repay the borrowing in the event of death or critical illness. This ensures that, in these distressing circumstances, your house would not have to be sold to repay the mortgage.



You may find the perfect mortgage for you at your local building society. But shopping around could land you with a much better deal or alternatively you can use a mortgage broker. Mortgage brokers scour the market to find the most suitable deal for you. A good mortgage broker can save you time and money.

If you are in full-time employment the lender will ask for written evidence for example, payslips and your P60 for the past two years.



They'll also probably write to your employer asking for confirmation.

If you're self-employed it more difficult to get a mortgage and as a result there are lenders who specialise in the self-employed. You would need to show three years audited accounts. If you haven't been in business long enough then the lender should accept a letter of confirmation from your accountant.

You may freely reprint this article provided the author's biography remains intact:

Leading Regional Mutual Selects SDS Maps' to Streamline Mortgage Application Processing

9th October 2002, SDS Applications Ltd, one of the mortgage industry's leading providers of mortgage lending software solutions today announced that the Vernon Building Society is to use the โ€˜SDS Maps' software for its mortgage application processing. Vernon Building Society has nine branches in the Cheshire area, backed by a local agency network.







โ€œWe were impressed with the powerful architecture of the SDS system,โ€ said David Eccles, Systems Manager at Vernon, โ€œAfter reviewing many solutions, we chose โ€˜SDS Maps' because it offered the greatest flexibility for our needs.



The system is very easy to customise which allows us to meet the changing needs of our businessโ€.







โ€˜SDS Maps' is a fully integrated, web-based solution, handling a mortgage application from customer enquiry through to completion. The system features integrated 'mortgage application specific' workflow, case tracking, powerful document production facilities and customisable management information (MIS) functionality. It is capable of producing pre-application mortgage illustrations and has been designed to be flexible enough to handle future changes to compliance regulation.



At draw down, cases will be transferred electronically to the Vernon's accounting and administration system.







The Vernon are also planning to take advantage of the systems powerful e-commerce functions, these include;







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A 'Broker Portal' where introducers can login and access product searches, create new applications, track the status of applications in progress and view commissions earned and pending.



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Mortgage search facilities, where potential customers can find out how much they can borrow and details of the mortgage products that best suit their needs.



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Online applications to โ€˜Offer in Principle'. (Applications do not have to be completed in one sitting, customers can return to a partially completed form at any time, an application could even be started in a branch and completed later on a home PC).



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Compliant online quotations



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Status Tracking facilities







The application is currently in the user-testing phase and is due to go live in November.











โ€˜SDS MAPS' forms part of SDS's integrated suite of mortgage systems that include;



โ€˜IFAMAPS' โ€" Online Broker Support Module, โ€˜EMAPS' - for interactive on-line applications with status tracking and โ€˜MyPage' โ€" the customisable e-banking module.



About Vernon Building Society



Founded in 1924 in Stockport, Cheshire, the Vernon provides competitive housing finance, savings and investment products. As a mutual, the Vernon's philosophy is to provide a responsive and individual service to it's members.







About SDS Applications Ltd



SDS Applications Ltd is considered one of the mortgage industry's foremost providers of mortgage lending software solutions. The company offers an integrated suite of mortgage processing solutions for lenders and mortgage packagers.



Recent Clients in the Mortgage & Lending sector include GMAC RFC, Solent Mortgage Services, The Chesham Building Society, Barnsley Building Society, Cambridge Building Society, Universal Building Society and National Counties Building Society.







--- ENDS ---







For further information please contact:







Justin Belcher



SDS Applications Ltd



Tel: 01494 778863



press@sdsapps.co.uk















Or visit the Internet site at www.sdsmortgages.com.

Barnsley Building Society UpgradesMortgage Application Processing to SDS Maps'

โ€œWe selected SDS's processing system over several other solutions,โ€ said Steve Lofthouse, Assistant General Manager (Systems) at Barnsley, โ€œSDS Maps has the flexibility and web-enabled technology we were looking for, and it combines all our mortgage processes into one system.โ€







โ€˜SDS Maps' is a fully integrated, thin-client solution, handling a mortgage application from customer enquiry through to completion.







Barnsley plan to take advantage of the system's powerful architecture to deliver the following



E-commerce functions:







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A 'Broker Portal' where IFAs and introducers can login and access product searches, create new applications, track the status of applications in progress and view commissions earned and pending.



ยท

Mortgage search facilities, where potential customers can find out how much they can borrow and details of the mortgage products that best suit their needs.







ยท

Online applications to โ€˜Offer in Principle'. (Applications do not have to be completed in one sitting, customers can return to a partially completed form at any time, an application could even be started in a branch and completed later on a home PC).







ยท

Compliant online quotations.



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Status Tracking.







The system features integrated 'mortgage application specific' workflow that systemises the underwriting process helping staff to focus on service provision. A task creation and management system monitors the whole process and allocates tasks to the most appropriate member of staff in order of timed priorities. Workflow will also enable case tracking to take place as all tasks are electronically recorded and the system will know at what point of the process an application is sitting.



Other key features of the system:







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Powerful document production facilities are an integral part of the system. All documents relating to an application are generated and merged in Microsoft Word format.







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The solution provides management with customisable management information (MIS) functionality, the system features a structured SQL database whereby staff can design and schedule their own reports using standard reporting tools.







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โ€˜SDS Maps' is capable of producing pre-application mortgage illustrations and has been designed to be flexible enough to handle any future changes to compliance regulation.



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SDS's solution allows two-way data transfers using Open XML.







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At draw down, cases then can be transferred electronically to the accounting and administration system.







โ€œSDS's staff are so easy to work with,โ€ continued Lofthouse, โ€œThey are professional, organised, helpful and have an in-depth knowledge of mortgage processing and the UK mortgage market. SDS's solution will allow for improved performance and functionality, which ultimately saves us both time and money.



I feel we have made the right choice in selecting SDS.โ€







The application is currently in the user-testing phase and is due to go live at the end of April.







โ€˜SDS Maps' forms part of SDS's integrated suite of mortgage systems which include;



โ€˜E-maps' & โ€˜IFA-Maps'- for interactive on-line applications, status tracking and IFA support and



โ€˜MyPage' โ€" the customisable e-banking module, which allows Lenders to provide affordable e banking services to their customers















About Barnsley Building Society



The Barnsley Building Society was formed in 1853, with nine branches in the Yorkshire area, backed by an agency network covering North Yorkshire to Warwickshire; the Society prides itself on its 'local' attitude to its members' requirements.



For additional information, contact Steve Lofthouse on 01226 733999 or visit the company's Website at www.barnsley-bs.co.uk







About SDS Applications Ltd



SDS specialises in the provision of systems and services to mortgage lenders. Since our inception in 1997 SDS have introduced new and innovative systems to the UK mortgage market, providing high quality applications exploiting the business advantages available using thin-client Internet technology. We have quickly become established as a leading supplier to this sector as a result of our cost effective solutions.



SDS leads the industry by putting its customers' success first.







Recent Clients in the Mortgage & Lending sector include GMAC RFC, Cambridge Building Society, Universal Building Society and National Counties Building Society.







For more information, contact Justin Belcher or Barry Yager on 01494 778863, via email at press@sdsapps.co.uk, or visit the Internet site at www.sdsmortgages.com