A known problem or inconvenience is approaching – the in-laws perhaps -, you consider, is the problem avoidable? Can I ignore it, ostrich style? Or do I meet it head on? This internal battle plays-out throughout life’s journey, and very much applies to the renewal of your mortgage at the end of the fixed term…
“Yes, there’s an element of certainty about time itself; and yes, I did know that the preferential initial interest rate was due to expire; but it’s not life or death! …And I’m far too busy to deal with this right now.”
Next, you find yourself on the Standard Variable Rate (SVR) and [ironically] invariably paying more per month than previously. This will motivate some parties to re-mortgage and others to accept the new rate… “it’s affordable” and/or “I can do without the hassle”.
Providing a qualified mortgage adviser and/or an Independent Financial Adviser with the necessary details as you approach the conclusion of your mortgage fixed rate term, or asap thereafter, can enable them to carry out some analysis of the market and potentially identify opportunities prior to commitment.
Being proactive can be a real benefit with regards to your mortgage; it’s cheaper and easier than you may think. At SWLaw for instance, there is no up-front cost and we only receive a fee direct from the lender if we successfully find and broker a new deal, this is known as the procuration fee. This structure will be mirrored by many advisers.
Considering how hard many of us work for our money - the Devon average wage being just over £11 per hour -, the prospect of unnecessarily overpaying makes re-mortgage enquiry appealing... How many hours at work could that decision save you? I’m the first to moan when my free time is ‘stolen’, e.g. by chores or the ‘can-you-nip-to-the-shops-on-the-way-home’ text, but there’s potentially a significant benefit at the end to soften the blow.
There have been some frankly incredible interest rates made available to mortgage borrowers recently and switching onto these products may reduce your monthly payment and/or your term considerably.
We have just worked with a couple looking to consolidate their outgoings and streamline their finances. After an initial meeting, and a few days of research, the package presented to the clients saved them a staggering £980 a month. This reduction in outgoings allows the husband to reduce overtime going forward and therefore spend more time with family; which is what life is really about – although I’m not sure how appreciative my fiancée would be if she saw more of me!
Based on the initial 2-year fix period alone, this remortgage could save the couple over £23,000 in payments; which the husband quickly pointed out is a shiny new car! This deal was brokered on a like-for-like basis, so the mortgage remains on repayment terms and will end of the same date.
Please contact myself or my colleague Roy if you have any mortgage queries you wish to discuss, or would simply like to review your current package to ensure you have the best deal.
Rob Cowsill, An Independent Financial Adviser qualified in Advanced Mortgage Advice and Equity Release