Remortgaging

If you haven’t looked at your mortgage seriously for the last ten years, then it is quite possible that you are paying more than necessary. Through finding a better deal, you could save yourself hundreds and even thousands of pounds! Those savings could buy a nice holiday, or maybe a new kitchen or conservatory.

Due to many lenders giving attractive offers to attract new customers, their existing loyal customers are often worse off. Now that your tasty discounts have ended on your mortgage, have you compared it to what you could be getting with a new mortgage? Compare your existing deal – the rate you are paying now, not the deal you got when the mortgage started – and compare it to what else your lender has available. Most likely you will find that you could be getting a better deal. By stretching your search to other lenders, you could find an even better offer.

When comparing new mortgages, remember to use the current amount and the remaining time you have left on your current mortgage to use when comparing to other mortgages. If you extend your mortgage term, then monthly payments will obviously fall, but you are more likely to be increasing the total cost of your mortgage.

If you find a better deal, you should also take into account any fees that you may have to pay in moving to another lender. A new lender may charge new valuation and arrangement fees, and your current lender may charge you fees for leaving them. Due to this, it is normally good to look at your current lender first to see if they have any better deals – if you move you mortgage to a different deal with the same lender, you really shouldn’t have to pay any new fees. You may also currently have a redemption penalty on your mortgage, but these normally apply during the bonus period at the start of the mortgage, so these may no longer be valid if you are looking for a new deal.

If you have been in your current mortgage for many years now, you may find that the new deals available today are much more suitable to your needs than your old deal is – for example, you may now be earning much more than you were when the mortgage started and may want to make extra payments to reduce the mortgage. New flexible mortgages allow you to make extra repayments, and they take effect immediately as interest is calculated daily. There are also mortgages available now which are effectively a current account with a huge overdraft!

So, if you haven’t been keeping up with the mortgage market, now could be a good time to check it out and see what savings you can make.