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A residential mortgage is a loan secured against a property you intend to live in as your main home. It is the single largest financial commitment most people in the UK ever make, and the interest rate attached to it can make a difference of tens of thousands of pounds over the life of the loan.
In July 2026, the average 2-year fixed rate sits at approximately 5.51% and the average 5-year fixed at 5.50%. But those averages conceal an enormous spread, and the deal you actually access depends on your deposit size, income type, credit history, and property type. At Square Gain Capital, we search across more than 50 lenders to find residential mortgage products that match your specific situation. We handle fixed-rate, tracker, variable, offset, and interest-only products, across standard and non-standard property types, for borrowers whose circumstances do not fit neatly into a high-street box.
Your interest rate is locked for an agreed period, typically 2, 3, 5, or 10 years. Your monthly payment stays the same regardless of base rate movements. At the end of the fixed term, you move onto the lender’s Standard Variable Rate, which is almost always higher. This is the point at which most borrowers remortgage.
A tracker rate moves in line with the Bank of England base rate plus a set margin. If the base rate falls, your payment falls. If it rises, your payment rises. Trackers can be more competitive than fixed rates in a falling rate environment, and some carry no early repayment charges, making them more flexible for borrowers who may want to switch products.
SVR is the lender’s default rate once any initial deal ends. It is set at the lender’s discretion and can change at any time. SVRs in 2026 typically sit between 7.5% and 9%. Remaining on SVR is rarely advisable.
An offset mortgage links your savings to your mortgage balance. The savings do not earn interest, but instead reduce the balance on which you pay mortgage interest. A £300,000 mortgage offset against £50,000 in savings means you pay interest only on £250,000. This works particularly well for higher-rate taxpayers and self-employed borrowers who hold large cash reserves.
Interest-only mortgages for residential borrowers are available but come with strict eligibility requirements. You pay only the interest each month, not the capital, so your loan balance does not reduce. You must have a credible repayment strategy in place: typically the sale of the property, a pension, or an investment portfolio.
Lenders typically lend between 4 and 4.5 times gross annual income for a standard application. Some lenders will go to 5 or 5.5 times for professionals, lower-LTV applications, or strong credit profiles. Joint applications are assessed on combined income. Affordability is also stress tested, with lenders calculating whether you could afford payments if rates were to rise. Your existing credit commitments, childcare costs, and regular outgoings all reduce what you can borrow.
We review your income, outgoings, credit history, deposit source, and property plans. We give you a clear picture of what you can borrow and which lenders are most likely to accept your application.
We obtain an Agreement in Principle from the most suitable lender. This gives you a figure to present to estate agents and demonstrates that your borrowing is credible. Most AIPs involve a soft credit search that does not affect your credit score.
Once you have an accepted offer on a property, we submit your full mortgage application with all required documentation. We manage all lender queries and keep you informed throughout.
The lender instructs a valuation of the property. Simultaneously, an underwriter assesses your application. This stage is where complications sometimes arise, and where our experience dealing with individual lender criteria and underwriter teams is most valuable.
Once the lender is satisfied, they issue a formal mortgage offer. Your solicitor reviews this and the process moves to exchange and completion
Run the numbers, then talk to us. Our financial calculators cover mortgage repayments, how much you could borrow, stamp duty, bridging finance and rental yield. Results are estimates only and should not be relied on as financial advice.
Residential mortgages cover a wide range of circumstances. Here are some of the scenarios our advisers navigate on a regular basis.
Rolling onto a standard variable rate could cost you hundreds of pounds a month more than a new deal. We review your options six months ahead, compare product transfers against new lender rates, and make sure you are not paying over the odds.
Ex-local authority flats, steel frame construction, properties above commercial units. Certain property types eliminate most high street lenders immediately. We identify which lenders in our panel will accept the property and at what LTV before you proceed.
Lenders scrutinise deposit sources carefully. A mixed deposit requires clear documentation and careful lender selection. We walk you through exactly what is needed and ensure the lender receives a complete, well-presented application.
Rates in 2026 are meaningfully higher than the 2021 lows, but the picture varies significantly by lender and product type. We show you the real numbers across the market before you commit, so you can plan your finances accurately.
Speak to an adviser to discuss your circumstances and explore how bridging finance could work for you.
Clear,honest answers to the questions we hear most from clients and introducers.
This is called a down-valuation. The lender will base the mortgage on the surveyor’s figure, not the purchase price, which increases the effective LTV and may reduce what the lender will advance. Your options are to renegotiate the purchase price with the seller, increase your deposit to cover the shortfall, challenge the valuation with additional evidence, or switch to a lender who uses a different valuation provider.
Yes, though your options are more limited than for a standard residential property. The nature of the commercial use matters significantly. A solicitor’s office below a flat is treated very differently from a takeaway or a nightclub. We work with lenders who accept a range of commercial uses below residential units, subject to valuation.
This depends on your plans for the property, your appetite for payment uncertainty, and your view on the rate environment. In July 2026, with 5-year fixes priced very close to 2-year fixes, the longer product offers good value for money if you plan to stay put. If you may move or remortgage in under two years, a shorter fix or a product without early repayment charges may be more appropriate.
For employed applicants: last three months of payslips, last three months of bank statements, two years of P60s, proof of deposit, photo ID, and proof of address. For self-employed applicants: two to three years of SA302 tax calculations and corresponding tax year overviews, or two to three years of finalised accounts. Additional documents such as an accountant’s reference, a gift letter, or evidence of bonus income may be required depending on your situation.
We search the market and handle the process so you can focus on moving.
Whole of market search across a wide panel of lenders
Dedicated adviser throughout the process
We handle the paperwork and liaise with lenders on your behalf
