When buying a home, it is important to consider the price and the ability to repay any money borrowed. The usual method of financing a home is with a loan secured by a mortgage over the property. Inquiries should be made as to the kinds of loans available and the rates of repayment.

Loans can be obtained from building societies, banks and credit unions. Each institution has different criteria for a loan and these should be checked and compared. Homestart Finance loans are attractive for certain applicants. While the repayments on traditional loans do not usually change apart from interest variations, the repayments on a HomeStart loan will vary with changes in interest rates but are limited to no more than 25% of a person's income. As the person's income goes up, so does the amount of the repayments. Often a person's initial repayments are insufficient to meet the interest costs and as a consequence the amount of the loan balloons (increases). It is only in the longer term when the person's income (and therefore the repayments) increases that the amount of the loan decreases. A HomeStart loan may be available to people refinancing. Other special loans are available in certain circumstances. For example, people who served in the armed forces may be entitled to a Defence Service Homes Corporation loan.

Where a loan is insufficient, a second mortgage may be needed. They have a higher rate of interest because the security for this loan is less and they are usually taken out for a shorter term and paid off first. Some financial institutions do not loan on second mortgages so it is advisable to see if a larger first mortgage can be obtained at a reasonable interest rate.

Bridging finance is a loan taken for a short time (normally, between the settlement date and the date the long term finance becomes available), usually at a comparatively high rate of interest. It should be remembered that such a loan is for temporary purposes and that it must be repaid in full at the end of the agreed period. If a long term loan is not available at this time and it is not possible to arrange further short term finance, a person may lose the property. High interest temporary finance may increase the debt so it is important to look very carefully at the possible results.