Even mountain climbers have to reach the summit at some point. And, after 14 consecutive base rate rises by the Bank of England (BoE), it seems that we’ve reached the end of the climb – for now at least.
Following news that inflation has dropped to 6.7% – and after the BoE voted to hold the base rate at 5.25% – the pendulum may have reached its full swing and is ready to swing the other way.
But what does it mean for mortgages?
Mortgage rate cuts
As a Guildford mortgage broker – and as a team of mortgage brokers in Guildford who are all homeowners – we all want to know the answer to this question: when will mortgage rates go down?
If you’re on a tracker mortgage then the good news is that your mortgage repayments will not be going up. Perhaps even better, though, is that if you’re about to remortgage, or if you’re about to apply for a first-time buyer mortgage, then fixed rate mortgage deals are getting cheaper.
Of course, they aren’t as cheap as they were this time last year, but the cost of borrowing, which is underpinned by the base rate, was never going to remain as low as it has been since the financial crash.
On the positive side, though, there is now the expectation that mortgage rates are going to continue to decrease, and that’s hugely reassuring.
Should I lock in now or wait for rates to fall even further?
Of course, people may be wondering if they should wait to benefit from even cheaper mortgage rates. However, as we all know, predicting the BoE’s next move is impossible. There is the chance that they may increase the base rate next time – we just don’t know.
If you are one of the many people right now that does need to get a new mortgage deal, then it’s worth remembering that, depending on the lender, a mortgage offer lasts for between three to six months.
So, if you get a mortgage offer today and rates continue to drop, then you could swap to a better deal (usually anything up to a few days before completion of your mortgage). The same principle applies the other way, too. So, if you apply for a mortgage and rates go up three weeks later, then the lender will need to honour the rate that you applied for.
Regardless of today’s rate, we’d recommend that you speak with one of our Guildford mortgage advisers, who’ll be able to get you the best rate of the day. And, if it improves subsequent to us getting you an offer, then we’ll look to getting you an even better one.
For advice, general guidance and the best UK mortgage rates, contact our team of Guildford mortgage brokers on 01483 238280 or e-mail info@complete-mortgages.co.uk.
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