If you are thinking are looking for a cheaper mortgage, according to Martin Lewis now could be the best time to be on the lookout to switch mortgage.
In this week’s Money Saving Expert newsletter, Martin Lewis explained that while the economic outlook in the UK at the moment might look a bit bleak, there is a silver lining.
‘The poor world economic outlook combined with UK uncertainty means the rates at which banks lend to each other have fallen in the last few months,’ the money guru explains. ‘It’s partly these long-term rates that mortgage firms base their fixed on, so mortgage rates have fallen too.’
‘Of course, they may well drop further, but as they’re cheap right now, everyone with a mortgage should check now if they can switch and save,’ he adds.
So what should you be keeping an eye out for when looking to switch mortgage? Martin Lewis first suggests checking your current mortgage deals.
This means checking the rate, what type of mortgage deal it is, when does the intro fixed deal end and what rate will it go up to. It is also worth checking when all the money due to be repaid and if you will be penalised for the switch.
‘If your rate’s about to end, ask your existing lender what its best deals are,’ says the Money Saving Expert. ‘These can have low fees as you’re not switching between lenders, so don’t need to pay costly fees – and it can set a benchmark for what to beat.’
If you do choose to continue with the switch, be sure to use a mortgage comparison tool, such as the one on MoneySavingExpert.com. At the moment mortgages are being offered at a two-year fix rate at 1.21 per cent, and 5 years at 1.55 per cent. However, be sure to shop around to make sure you find the best one for you.
‘After comparing deals, if it looks like you can save, many people should consider using a mortgage broker – they have access to info about what each lender looks for that’s not available to the public,’ Martin Lewis adds.
Will you be on the lookout to switch mortgage?