Bank of China (UK) Ltd Mortgages

The Bank of China Ltd offers a range of mortgages. Choosing the right mortgage is a matter of reviewing your circumstances, outgoings, income and savings to find the best deal.

Fixed rate mortgages from the Bank of China are secured loans with a constant rate of interest on your monthly payments. Instead of fluctuating with the economy and the Bank of England base rate, fixed-rate mortgages lock in a rate for an agreed period. This means that your repayments will be steady and predictable, even if the base rate changes during that time.

Yes, like many providers, the Bank of China offers tracker mortgages. These come with a fluctuating rate of interest that tracks the Bank of England base rate. Tracker mortgages mean that the interest rate on your mortgage – and thus your monthly payments – can go up as well as down over the agreed period.

LTV or loan-to-value (LTV) is the percentage of the property’s value covered by the mortgage. If, for example, you take out a mortgage from the Bank of China with an LTV of 75%, the loan would cover 75% of the property’s value while your deposit covered the remaining 25%.

As a general rule, high loan-to-value mortgages will have higher interest rates which will increase their overall cost. This is because the lender is shouldering a larger share of the property’s value and thus is taking on a higher risk.

A low credit score might block you from accessing a mortgage from some providers entirely, due to your higher perceived risk. For those who are willing to lend, there may be a caveat attached, such as higher interest on your mortgage, as the provider will be keen to reduce risk in the event of default.

Defaulting on any mortgage can have serious consequences and ultimately you are at risk of your home being repossessed. You should assess your financial situation carefully before committing to a mortgage and if you do find yourself at risk of missing payments, speak to your mortgage provider to discuss your options before you miss a payment rather than dealing with the consequences afterwards.