If you’re feeling worried about your mortgage right now, you’re not alone 💡 But there are things that can be done - here are five practical suggestions to help ease the panic
“You can guard against any further increases this way,” says Kim Balasubramaniam from The Mortgage Mum brokerage.
The good news is that, if between now and your current deal coming to an end rates do start to come down, you can change your mind about which deal you want to remortgage to, she says. “So you’ll get peace of mind now, knowing you’ve got a fixed rate that protects you against further rises. But equally, if rates do start to come down, you can look to change the product you’ve booked if a better deal does appear.”Although the average two-year fixed rate is 6.
This is particularly the case if your loan-to-value – which is essentially the proportion of the overall cost of the property that the bank is lending on – is 60 per cent or less.could mean that you will qualify for a more competitive deal when you come to remortgage.It is particularly important to shop around for a cheaper deal if you have moved on to your lender’s standard variable rate , as most SVRs are usually at least two percentage points higher than the best buys available on the market.
Andrew Montlake, managing director at Correco mortgage brokerage, says even if you need flexibility, you don’t need to just stay on a lender’s SVR: “You could, for example, move to a tracker rate with no penalties if you want to exit, which would be cheaper than staying on the SVR.”“Lots of borrowers will still be on a super low fixed rate,” says David Hollingworth.
Getting into the habit of allocating more of your monthly spend to your mortgage now will mean you do not have such a big shock when your current deal ends, and that will give you peace of mind. “And if you put that money in a competitive savings account, you might even earn more interest on it than you’re paying on your mortgage.
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