As I have said before and with the run up to year end, lenders have been actively looking at their offerings and loosening their criteria, positively. Some rates have even been reduced and nearly all re-mortgage deals now come with a contribution to valuations and legal fees to keep the cost of changing lenders to a minimum. There’s no excuse to be sitting on a high rate when you don’t need to be!
Also, BEWARE, that some lenders are sending out letters to those coming to the end of their product term offering them new rates, but giving them a deadline in which to switch. We had one customer recently who was four months out from their current rate changing from a fixed rate and moving on to the lenders Standard Variable rate. They were offered some great new rates to stay with the lender, but had a deadline of just two weeks in which to accept, even though the product wasn’t changing for four months! This is not acceptable, no one should be pressured to accept a deal and we have passed this example on to the industry trade body to take on. However, some customers might accept this and go with the deal. What if rates decrease in the next three months? You’d be annoyed. Read the small print, do not panic and get expert advice.
And finally, do you look at your financial budgets frequently? A report from a well known credit referencing agency has suggested that over 78% of mortgage people surveyed are not currently budgeting for a rate rise. We all know rates will rise at some point, probably after Brexit now, but nobody knows when this will happen! Many people asked did not know how much a rate rise would cost them on a monthly basis, despite many respondents believing rates would rise over the next twelve months! A 1% rise on a £100,000 mortgage can increase the monthly payment by as much as £83. As we go in to some months of uncertainty, and especially with regards to the cost of funding within the mortgage market, do make sure you are ready for all eventualities.