Your mortgage rate might have been lovely while it lasted, but if your fixed deal is coming to an end, its time to make a plan.
The reality is, that coming off such a low mortgage rate will inevitably leave you with increased monthly payments – its important to prepare for this rather than stick your head in the sand. Check your monthly outgoings, where can you cut back? Many of us pay subscriptions and fees for things we just aren’t utilising. Look at your finances and set a monthly budget for your future mortgage, what can you afford this figure to increase to, let your mortgage broker know that this is the top end of your budget.
Do not wait until your mortgage deal expires – we will contact current clients up to 6 months in advance of a remortgage, but if you are coming to us as a new client its important you give your broker enough time to shop around. Many lenders will allow us to lock in a rate 3-6 months in advance – so it pays to be prepared! The beauty of this is, you can also switch to a new rate if a better one becomes available before your remortgage date!
Staying with your existing lender is certainly most likely the easiest option, but its highly likely it will not be the most cost effective. Rates are changing all the time, and just because their mortgage product suited you 5 years ago, doesn’t mean they will be the best lender for you now.
It’s easy to get caught up in the advertised interest rate – but what people often forget is the overall costs of the new product, including arrangement fees, solicitors’ fees, searches, surveys, mortgage terms and early repayment charges. At KMS Financial we look at the true cost of your fixed period, not just at the lowest interest rates.
What if you do all of this and your new mortgage is unaffordable? Discussing your options early with your broker gives you time to manage the situation – you could discuss extending your mortgage term, cutting your household bills budget, or finding alternative products.
Speaking to a broker early can make all the difference to your future – the biggest mistake? Leaving it to the last minute.
Want to book your appointment to get started on your remortgage? Book a call with us today and lets get you ready.
