According to data from Yorkshire Building Society – which shows that homeowners could save as much as £200 a month in repayments when switching from a five-year fixed mortgage later this year – we are heading towards a ‘re-mortgage boom’ with billions of pounds worth of loans maturing from October.
It’s already been a big year for re-mortgaging, in May alone, the number of people refinancing rose by 20% according to UK Finance. There are big savings on offer to those who move to a better rate. Yorkshire Building Society states that a buyer of a £200,000 property who took out a five-year fix at 85% loan-to-value (LTV) in October 2014 might have paid a rate of 4.25%. By switching to a new five-year fix now, they could potentially cut their rate to 1.54% – saving more than £200 on monthly repayments!
Is now a good time to switch?
Short answer – YES – The mortgage market remains very competitive, with tonnes of lenders fighting to offer the best rates. When switching to a new mortgage, the majority of borrowers choose a fixed-rate deal, where the interest you pay is guaranteed for specific period, usually two, three or five years. In recent years, fixed-rate mortgages have been priced very cheaply, with a low Bank of England base rate bringing down the cost of mortgages.
When can I find a new deal?
You don’t have to wait until the end of your fixed period to apply for a new mortgage, so it can help to look in advance. Many lenders allow you to lock in a new deal six months ahead of time and one of our LillyBrooke advisors will provide impartial advice, suited to your needs when selecting a new product. We take care of the hard work for you to save you money.
Get in touch today for a free consultation and to find out where you stand with your mortgage!