Remortgage. Does it pay to switch deals?

How to save money by remortgaging.

As a home buyer, you could easily cut your monthly mortgage cost by moving from a standard variable rate (SVR). The SVR is the rate your mortgage defaults to after the initial rate. This might have been a discounted rate or a short term fixed rate.  It can also be referred to as the rollover or reversion rate. Currently, SVR rates are around 6% to 7% with some lenders charging more. So it may pay to remortgage.

By comparison, our mortgage “Best Buy” table is showing both fixed and variable rates around 3% to 4% subject to eligibility.

The industry estimates that one in five mortgage borrowers is paying the higher SVR. Generally, there are three types of borrowers on SVR.

Those who do not realise they could get a better rate by remortgaging.

Included in this group, are people who remortgaged five years ago when rates were higher. They have now moved to the SVR and may not have noticed the difference in their monthly mortgage repayments. They are unaware of how much they could save.

Those who cannot switch.

This may be because of a change in financial circumstances.

• Their employment status may have changed from employed to self-employed.
• They have taken out large payday loans.
• Built-up expensive debts on credit cards.

If you feel that you fall into this group it is always worth looking at your options annually:

• The business may now be more established.
• Your house may have increased in value making your “loan to value” ratio better.
• Your poor credit history is now a year further behind you.

Those who did not realise that they can remortgage.

So, I hope that you are now aware that you possibly can.

How Anstee & Co can help you remortgage.

We are Independent Mortgage Brokers. This means that we look at all the remortgage options available to you. Our advice is unbiased. We will look at all your financial options. Some financial advisers only operate from a limited panel or only sell their products and services. Why not arrange a meeting with us today?

A mortgage is a long-term financial commitment. Making the wrong choice can affect your long-term financial security. Our expert team of mortgage advisers will help you make the right choice and ensure that the remortgage process runs as smoothly as possible.

Remember that the lowest rate is not always the best overall deal for you!

Our expertise covers all aspects of financial planning including Pensions, Investments, and Equity Release.

If you have any thoughts on this article, “Remortgage. Does it pay to switch deals?”, then we would love to hear from you.

Finally, the information contained in this article is for information purposes only and does not constitute financial advice. Anstee & Co. is authorised and regulated by the Financial Conduct Authority (FCA).

 

AS A MORTGAGE IS SECURED AGAINST YOUR HOME, IT COULD BE REPOSSESSED IF YOU DO NOT KEEP UP THE MORTGAGE REPAYMENTS.