If you wish to find the perfect mortgage deal, here are some tips that may push you in the right direction.
Ask Existing Lenders
A “product transfer” is when you change lenders from your current one. It wasn’t a wonderful alternative in the past, but now days, if you’re not borrowing more, your current lender might forgo affordability checks, it can be a good option. Additionally, there may be fewer paperwork and reduced costs.
Find The Perfect Mortgage Deal – Compare The Market
See what is out there, to find the best deal available. For example, a great place to start is on the Money Saving Expert site. It may be a tough time to find great deals, but if you use the first place you find, then you are bound to lose out.
Mortgage Brokers
Lenders conduct credit and affordability checks, which may be more difficult for some borrowers to pass given the current increase in living expenses. It can be difficult to predict who will accept you and how much you can borrow. It will be exceedingly challenging for you to obtain this information on your own, so find a good mortgage broker.
How Interest Rises Affects Existing Mortgages
You will rapidly notice fees rising on a variable or tracker mortgage by about £12 per £100,000 of mortgage debt. On the other hand, if you have a fixed rate, there won’t be any changes until your existing fix expires. When that happens, you’ll automatically switch to your lender’s standard variable rate (SVR), which for most people will be a significant rise at 4.5 percent to 5.5 percent.
However, the majority of individuals will understandably want to secure a new fix or offer when the existing one expires. Unfortunately, today’s cheapest repairs are three times more expensive than they were in last October when they peaked, but they are still considerably cheaper than the SVR, so act quickly.
Deals Are Disappearing
Action is required right now to see whether you can save if you are on variable rates or have fixes that are about to expire (some people can even lock in a deal up to six months in advance). Delay could be expensive because lenders reprice new packages on a weekly basis, making today’s prices obsolete tomorrow. Sub-1 percent corrections are a thing of the past. The cheapest fixes available today include interest rates as low as 2.49 percent for two years, 2.74 percent for five years, and 2.73 percent for ten years.
The premium for fixing for a longer period of time is currently (rare) quite cheap, notably for 10 years. Longer-term solutions from today could appear to be fantastic bargains in the future with expected more base rate increases. But be aware of early departure fees.
