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V

VALUATION (MORTGAGE)

A report that indicates the value of the property to be mortgaged, prepared by an expert, chosen by the lender, applying reliable standards.

VARIABLE Interest Rate

When the interest rate on a loan (usually a mortgage) is variable, the interest rate may be adjusted at pre-set intervals to follow fluctuations in an index that is usually set by money and financial markets.

The main risk is that the mortgage instalment could increase. You should understand that a rise in interest rates will have a greater impact on longer-term mortgages.

The initial interest rate on a variable-rate mortgage is lower than the rate on a fixed-rate mortgage for the same term, but the rate can rise over time, causing mortgage instalments to increase as well, sometimes considerably.

A variable-rate mortgage is recommended for those who want a rate that is always in line with the market rate and who can bear the cost of higher mortgage instalments.