Mortgage

• Mortgage

  • Borrowing money to buy premises. Interest rate is added to the loan at the beginning and the whole amount is usually repaid in equal monthly statements over a period (usually 25 years).
• Disadvantages:

  Mortgages are usually secured against a property- failure to meet monthly repayments will result in the property being repossessed.
• Disadvantages:

  A lot of interest is paid back over a long period of time therefore its expensive.
• Advantages:

  Repayment is over a long period of time e.g. 25 years.
• Advantages:

  Fixed interested rates can be arranged so that the organisation knows what it's monthly payments will be for the foreseeable future.