Reasons why you should remortgage
It’s a question I hear often. Why should I remortgage? People who haven’t reviewed their mortgage in years wonder what the benefit of doing so is. Let’s start with the headline-grabbing answer for reasons why you should remortgage: It saves an average of £216 PER MONTH!
Not long ago, people used to get one mortgage and stick with it for years, regardless of the rate. Now, one out of three Britons chooses to remortgage. That still leaves two-thirds of people who choose not to remortgage.
Unlike the times when people used to stick with one mortgage during their lifetime, society is more dynamic today. People are changing jobs more often and moving from one city to another more frequently.
Circumstances often change for mortgage payers today. This means that mortgage circumstance change, too.
Remortgaging can be a wise financial decision, but it all depends on the particular circumstances.
Research from L&C Mortgages discovered that 30 percent (or 3.4 million households) do not know their current interest rate of their mortgage. The same research article goes on to state that a further 1.1 million households are wasting £2.78bn by sitting on the wrong mortgage deal.
Normally, the main reason why anyone would want to adapt his or her mortgage concerns finances. Anyone would want to save money on the monthly mortgage rate.
Looking for a better deal on an existing loan is often a priority for anyone who is taking remortgaging into consideration.
A better deal means cheaper interest rates, i.e., monthly saved money. Remortgaging could mean obtaining a better rate, especially if it was a mortgage that you took out some time ago.
How much money will a remortgage save you?
By switching to a better deal, UK homeowners could save an average £216 each month on their mortgage or over £2,500 annually.
However, surprisingly over half (58%) have never re-mortgaged to save money.
In addition to getting a better interest rate from a new mortgage, another reason why one might consider remortgaging is the fear of rates going up.
If you are one of the 3.4 million households that haven’t reviewed their mortgage in recent years, you should be aware that not only are you likely to be paying a higher rate on your mortgage than you need to, but that if the Bank of England raises their rate, your mortgage payments are likely to go up.
To put that into perspective, the Bank of England’s base rate is at the lowest it has ever been.
One last reason that is worth noting on why anyone would consider remortgaging concerns property value increase.
If property value has risen quickly since the mortgage was taken, then the loan-to-value band is certainly lower. This means that the person remortgaging is eligible for much lower rates.
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So if you’re looking to save money or if you simply haven’t reviewed your mortgage in a while, think about contacting Dan The Mortgage Man to see what he can offer.
You can even ask for a Mortgage Consultant to come and visit you in the comfort of your own home.