New research shows that 75% of borrowers could be missing out on the opportunity to pay less for their mortgage. By not shopping around, three-quarters of homeowners could be paying, on average, nearly three thousand pounds more than is necessary over the lifetime of the loan.
The research by YouGov and a leading provider of mortgages also found that those with mortgages were twice as likely to change who supplies their energy rather than change their mortgage provider. Yet, changing their energy provider would only save homeowners £200 whereas changing their mortgage provider would save around £2,800.
A homeowner with a 25 year £150,000 mortgage who is sitting on their lender’s standard variable rate of 4.5% would pay approximately £833.75 per month. Yet by remortgaging to a fixed rate of say, 1.84%, the payments would fall to £624.16. That’s a saving of over £200 each month.
Apparently over half the mortgage holders in the UK have never switched providers to get a better deal. With historically low mortgage rates UK households are basically throwing thousands of pounds away each year.
I doubt people stay with their mortgage provider out of loyalty, I think the main reasons borrowers don’t change is that they don’t really know where to start and the whole process seems quite daunting. So here goes…
1. Find a Mortgage Adviser you trust – preferably one who is independent and able to look at the whole of the mortgage market for you.
2. They will check which lender will offer you the best rate for your circumstances, taking into account affordability, credit status, the value of your property etc.
3. Your broker will apply to the lender for your mortgage for you
4. The lender will carry out their various checks, (they may also want to come and value the house), and then they will issue your mortgage offer
5. From there the appointed solicitor will carry out the legal work to change the charge from your existing lender to your new lender
6. Finally, on the day of completion, your solicitor will request the funds from your new lender and pay off your existing loan. The new lender will write to you confirming when your first payment is due.
As an incentive, most lenders offer to pay for the valuation and the legal fees. This means that the whole process can sometimes be done for free and often for only a few hundred pounds which you can hopefully recoup via your new lower monthly payments.
New Year’s Resolution Number 1
Find out if you can save money on your mortgage!
For more information speak to a mortgage adviser on 01628 507477 or contact us.
2 days ago
There was a 32% increase last year in 100% loan-to-value (LTV) mortgages which are mortgages that require zero deposit. According to a recent report by chartered accountants and business advisers, Lubbock Fine, the reason behind this is buyers simply struggling to save enough for a deposit.
3 days ago
Many people are quite private when it comes to what is in their bank account. In this short blog, we look into what Brits have saved by age group.
Research from buy-to-let lender, Landbay, shows that UK landlords are looking at raising rents ahead of the Renters' Rights Bill which is due to come into force this year.
Data shows landlords could miss out on green mortgages due to expired energy performance certificates.
Buying a house is a big deal, and where you are planning to buy will make a difference financially. In this short blog, we look at the most affordable and most expensive areas and how much you need to be earning to buy in there.
20 May 2025
Equity release is a type of mortgage that allows homeowners 55 and over to access money from their property's equity without having to leave their home. This is done by securing a loan against the house which is usually repaid by selling the property when the borrower passes away or has to move into long-term care.
19 May 2025
It’s important to ask questions about the property you are interested in before taking that step to make an offer. A little probing can make all the difference between buying your dream house or something that requires a lot of work.
16 May 2025
There are millions of homeowners over the age of 60 who are likely to release money from their homes to pay for their lifestyle during retirement giving those who are 'asset rich but cash poor' a way to live out their retirement the way they wish.