Save money, potentially a huge £2,500 every year just by remortgaging your home. Homeowners who fail to review their mortgage options when their current deal ends, risk losing this amount of money every year. They could be getting advice to help them from L&C, which is the UK’s largest fee-free mortgage broker and adviser.
This October, around £29bn of mortgages came to the end of their initial rate. That’s the largest number of deals ending in any month this year. When these deals finish, borrowers will usually automatically move onto their lender’s higher standard variable rate, unless they move onto a new deal.
Last year, homeowners who failed to remortgage forked out an average of £2,200 extra annually, but those who don’t act this year will see their costs jump by £2,500 a year. This means that they could be spending an extra £2,500 that they don’t need to. You could get a few family holidays in with that amount!
Mortgage price war drives rates down
Rock-bottom interest rates and competition between lenders have prompted the launch of some of the lowest mortgage rates ever seen, so if you’re considering remortgaging, now’s the ideal time to do it. In October two-year fixed rates were 0.32 percent lower than the same time last year, and five-year fixed rates were down by 0.41 percent.
So, don’t miss out, and head to L&C to learn more.
David Hollingworth from L&C Mortgages said, “Lender competition is fierce and that has helped drive down mortgage rates to new historic lows over the last 12 months.
That’s great news for mortgage borrowers coming to the end of a deal but also underlines just how important it is to shop around for a new deal.
“Although borrowers have arguably never had it so good, it’s not all about the headline rate and lender fees and criteria are important considerations in finding the right mortgage deal. With the market changing so rapidly, advice will help homeowners make the most of the rates on offer.”
Check your costs
If your mortgage deal is coming to an end soon, make sure you start looking around for a new deal as soon as possible. Give yourself a chance to take advantage of today’s low rates, save money, and perhaps have more to spend on that holiday you deserve.
You can usually lock into a new deal three to six months before your current deal ends. If you do this, you should be able to move onto your new rate straight away, without going onto your existing lender’s costly standard variable rate first.
Here are some of the questions you should ask before remortgaging:
Are there any early repayment charges to leave my current deal?
If so, will these outweigh the savings I’ll make by remortgaging to a better deal?
What are the arrangement fees for the mortgage deal I’m considering moving to?
How far in advance can I sign up for the new deal?
Can the lender arrange for my new mortgage deal to start as soon as the old one ends?
If you’re not sure about any of the answers to these questions, seek professional advice from a mortgage broker.
If you’re not sure how much you could save by moving onto the best mortgage deal rather than sticking on your lender’s SVR, then head to L&C to find out.