Yes, we covered this topic in our last article. However, things are changing very quickly and there are increasing levels of noise that point towards the fact that interest rates are about to rise.
However, it’s likely that speculation will end on the 4 November, which is when the Bank of England will determine whether or not an interest rate rise is necessary. The Monetary Policy Committee will take a vote and if its nine members back a rise, then it’s good news for savers, but not the best news for those currently on a tracker or standard variable rate mortgage.
Our team of Guildford mortgage advisers is currently taking daily calls from those looking to apply for a fixed rate mortgage – as well as those hoping to remortgage before interest rates rise – so it seems as though people are taking it seriously.
For those unsure of how an interest rate will impact them, then the following four points may be of interest. However, if you’d rather speak to a Guildford mortgage broker then one of our Surrey mortgage experts will be glad to help.
1. What mortgage are you on?
It sounds simple, but many people do not know the type of mortgage they’re on or the associated rate. Only once you have established these two aspects can you move forward. So, rather than put your head in the sand grab the paperwork with both hands and find out your situation.
2. Scenario plan
Once you’ve tackled point one, you’ll be able to work out the potential impact of an interest rate rise. If you’re on a fixed rate mortgage then you won’t need to worry – for now at least. Simply work out when the term ends and put things in place to avoid the standard variable rate (SVR) mortgage (a good mortgage broker will do this for you). If you’re on a tracker mortgage or SVR mortgage, then work out how your mortgage repayments – and finances as a whole – will be affected if interest rates rise by 0.25%, 0.50% and 1%. If either of those feels uncomfortable, it’s probably time to get a better mortgage deal.
3. Decide on mortgage affordability
To be honest, as a Guildford mortgage broker, we’d advise you to make life easier for yourself and get help from a mortgage adviser. Broker fees are minimal, when compared to the savings that can be made – let alone the time and hassle you would spend searching for the best mortgage deal. So, why do it yourself when you can get a professional to do it for you.
4. Is overpaying an option?
If you have money sitting in the bank earning little to no interest, then getting ready to pay off a portion of your mortgage debt may be a better use of your capital. By doing that you’ll not only reduce your mortgage liability, but you may also open up a number of possibilities when you come to apply for a new mortgage as you’ll need to borrow less and may have access to more competitive mortgage deals. Just be careful when it comes to paying off fixed rate mortgages early, as you’re generally limited to paying off a percentage each year without incurring charges.
Our advice is don’t leave it to the last minute and until the best mortgage deals available now are pulled – act now and get a mortgage broker to work on your behalf.
Get in touch with our team of expert Guildford mortgage advisers to find out how we can help you access some of the best mortgage deals in the UK right now. You can reach us on 01483 238280 or email@example.com.