Got a great mortgage deal? It is amazing how quickly time passes – the first most of us know about the end of our mortgage deal is when we suffer interest rate shock - that feeling you get when you open up the letter from your lender telling you that your mortgage payment is going up!
Realistically, if you want to move seamlessly from one deal to another then you need to be thinking about arranging a replacement deal about 3 months before your current deal comes to an end.
You have a few options available to you - you can change products with your current lender, remortgage to a different lender, or remain on the standard variable rate (SVR) with your current lender.
Here's some useful information to help. Have a read through and when you're ready give us a call on 01225 719043 or use the 'contact us' page to get in touch and we'll talk you through the finer detail.
WHY DON'T I JUST STAY WITH MY CURRENT LENDER?
Well this may actually be the best option - but it's good to be sure! Your lender will more than likely offer you a new rate. In fact they will probably contact you to get you onto a new deal asap - this is because taking a new deal with them will almost certainly mean you are 'tied in' again for another period of time.
It would be prudent to have a look at what is available in the market before making this commitment as you may be able to save money by moving to an alternative provider.
Even if you're staying with your current lender we can still help you choose the right deal if you are unsure - call us on 01225 719043.
OK, SO WHAT'S THE PROCESS IF I CAN GET A BETTER DEAL ELSEWHERE?
It's quite straightforward really - you complete a simple remortgage, paying off your current mortgage and simultaneously setting up a new one (see our 'Re-mortgaging' section). You need to be sure to time your remortgage correctly so that you don't incur unnecessary additional costs by exiting your current deal too early. Don't worry though - we can help you with this.
WHAT IS A 'STANDARD VARIABLE RATE'? (ALSO KNOWN AS 'BASE MORTGAGE RATE')
Imagine your lender couldn't get hold of you for one reason or another when your deal is coming to an end - they have to change your rate to something, but you haven't given them any instruction. To cover these circumstances all lenders have a 'Standard Variable Rate'. This is the default follow on rate that your mortgage will switch onto if no other instruction is given.
Each lender has their own rate and each one works differently. It may follow the Bank of England Base Rate (BBR), or it may be linked to LIBOR. It could be anything! Sometimes a lender has only one SVR to cover all of their customers, sometimes it will be specific to the original deal you took.
You will be able to find your lenders SVR in the original mortgage offer for your current deal.
MY LENDER'S STANDARD VARIABLE RATE (SVR) LOOKS GOOD - SHALL I JUST STAY ON THIS?
This can be the right option for some people, especially if you have a mortgage product taken out before the credit crunch - the SVR may be very low. However, please bear in mind that the SVR isn't necessarily linked to the Bank of England Base Rate (BBR). Therefore it is possible that the lender could increase it as and when they feel like it, and by how much they please - so be sure to check your original terms and conditions. If you need any guidance on this please get in touch.
Think carefully before securing other debts against your home. Your home may be repossessed if you do not keep up repayments on your mortgage.
We always aim to provide a high quality service to our customers. However, if you encounter any problems and we are unable to resolve them you can take your complaint to an independant ombudsman. Our advice is covered under the Financial Ombudsman Service (http://www.financial-ombudsman.org.uk/consumer/complaints.htm). You may be able to submit a claim through the EU Online Dispute Resolution Platform (https://webgate.ec.europa.eu/odr/main/?event=main.home.show if you live outside the United Kingdom or if you prefer not to deal directly with the Financial Ombudsman Service.)
The overall cost for comparison is 8.7% APR for customers who may have their access to credit restricted.
FX Mortgages is an appointed representative of Mortgage Intelligence Ltd which is authorised and regulated by Financial Conduct Authority under number 305330 in respect of mortgage, insurance and consumer credit mediation activities only.