Time to review your mortgage?

Getting a mortgage is a big step towards buying a home, and is definitely cause for celebration. Your mortgage deal might have been competitive when you first got it. However, by regularly reviewing your mortgage and remortgaging when an appropriate deal is available, you could save a lot of money, amounting to thousands of pounds.

Remortgaging means moving your mortgage to a new lender while staying in the same property. If you’ve had your mortgage for a while, and you haven’t reviewed it, how sure are you that you’re still getting a competitive rate? At the very least, you should review your mortgage when interest rates change because this will affect how much you pay.

The base rate is set by the Bank of England and is important to homeowners because it acts as a benchmark for the cost of borrowing money – the lower the base rate, the lower the interest rates. We’ve started to see signs of inflationary pressures, which means if the base rate goes up, then inevitably, mortgage interest rates are likely to follow.

If you have been a homeowner for a few years and your fixed rate mortgage is coming to an end, your mortgage will revert to your lender’s standard variable rate (SVR) of interest. It’s important that you start planning your mortgage options at least four months before the end of the fixed rate period end-ing.

Why review your mortgage?

• Despite the fact that we’ve benefited from historically record low interest rate levels, some mort-gage lenders have started to increase rates in anticipation of further Bank of England base rate in-creases

• If appropriate, you could save thousands of pounds over the full term of your mortgage if you move to a more comparative scheme rather than remaining on your current lender’s SVR of interest.

• If your initial fixed rate mortgage scheme has come to an end, you may wish to switch mortgages to take advantage of a new lower fixed rate

• Fixing your mortgage rate to a new scheme will provide peace of mind and security in the event of further rate rises

Streamlining your largest debt

If you’re not tied in to a mortgage deal with early repayment penalties, why not see how your current deal compares to new deals that have since come onto the market? If you do nothing when rates change or your mortgage deal ends, you might lose out to a more attractive deal.

Your mortgage is likely to be your biggest financial commitment. So it follows that streamlining your largest debt could produce the largest saving.