When is best to act?
The super rock-bottom mortgage prices of the past few years just keep on going lower. What’s more, it looks set to continue. Those people looking for a mortgage now are considered better off compared to those arranging mortgages just six months ago. So when now is the best time to remortgage or apply?
Competition is fierce
According to MoneyFacts, mortgage rates have fallen in the first six months of 2016, down from what was already the lowest rates ever recorded. With competition fierce in the mortgage marketplace, rates just keep on going down and since January, all types of fixed-rate mortgages have fallen, on average.
First-time buyers are still struggling to get a look-in though, due to inflated house prices. Government figures show that first-time buyer success has fallen by a third in the last ten years.
Prices across the entire country, but particularly London, have soared so high that despite the incredibly cheap home loans available, the reality of home ownership is still unattainable for many.
How much savings are on the table?
“Those looking for a mortgage now would be substantially better off than they would have been had they looked six months ago” MoneyFacts
So ironically, those first-time buyers that have perhaps been forced to wait until they save a bit more of a deposit, could actually save a bit each month by their delay.
Those that are on the property ladder already, also stand a good chance to make significant cash savings on their monthly mortgage payment.
A homeowner with a £200,000 five-year fixed-rate mortgage, with a repayment term over 25 years, would in fact save almost £250 taking the mortgage now than six months ago.
The most popular fixed rate mortgages are taken on a two-year term, which is now available for an average of just over 2.5%.
It sometimes pays to wait – but don’t miss the boat either!
Deciding on the best time to switch mortgage is difficult right now as many homeowners will be waiting for the next fall in rates. Whilst rates are expected to remain low, and there is a good chance they will drop even further, there isn’t a crystal ball and in an uncertain economy anything can happen.
The best thing to do is to keep up-to-date with the current best mortgage rates by subscribing to our monthly newsletter and keeping a close eye on our online articles as well as LinkedIn and Twitter.
Working with a specialist mortgage broker who understands your situation can also help ensure you don’t miss an opportunity to save money, whether you are a first-time buyer or looking to remortgage.
Get a mortgage review with Chris
If you would like us to undertake a review of your current mortgage deal or you are thinking of purchasing in the near future and require funding, please contact Chris for a free, no obligation appraisal.
Tel: 01403 780 770
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