With the increasing cost of living and rising interest rates affecting households across the country, many homeowners may be unsure about when is the right time to look for a new mortgage deal.
Re-mortgaging is the process of getting a new mortgage on your existing property, either with your current or a new lender. Most commonly, the reason to re-mortgage is to save yourself some money, but you may also want to release equity for home improvements or other reasons.
Do you have one of the 1.8 million fixed rate mortgage deals that are scheduled to end in 2023[1]?
Should you be thinking about re-mortgaging now or remain with your current mortgage? It’s a very important decision that could impact your finances by thousands of pounds every year.
If your mortgage is on a fixed interest rate, there is likely to be an expiry date, after which time you will usually automatically move onto your lender’s standard variable (SVR). The SVR is usually a higher rate, which will mean your monthly payments will increase as well. By re-mortgaging, you can secure a new rate to avoid moving onto the SVR.
Whilst interest rates are currently higher than they have been for some time, by choosing a new fixed rate, you can fix your monthly payments for the term of the fixed rate product. Even though your monthly payments are likely to be higher, fixing your new monthly payments will, at least, assist you with budgeting. By reviewing your mortgage options in good time (ideally 6 months before your current rate is due to end) it is possible to secure a new fixed rate now, knowing that even if interest rates rise before your current deal ends, the new deal you have secured will not change.
It is important to obtain professional advice to see if re-mortgaging is the best option for you and to help you identify the best mortgage deal to meet your needs. Find Peace of Mind provides independent advice and we have access to products from the whole of the market, to ensure you are obtaining the best possible option for your circumstances. Contact us today for a no obligation discussion around your options.
[1] Figure quoted by UK Finance
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