This is often a time of year when we reflect on what’s working in our lives and what we might want to change in the coming year. These aims and ambitions are often centred around physical fitness, but, at Mortgage Confidence, we’re firm believers that financial fitness is just as important.
Historically, mortgages were something we took out when we bought a house and then didn’t think about again until we moved home. Which, when you consider that it’s probably the biggest financial commitment we make, seems ridiculous.
We should really be keeping a watchful eye on what’s happening in the mortgage market and, at the very least, review our arrangements when interest rates change or our mortgage deals come to an end.
So, while ‘new year new mortgage’ doesn’t have quite the same ring as ‘new year, new you’ we’ve got five reasons it might be worth considering a remortgage in 2020:
Reduce monthly outgoings
If your mortgage deal has expired, then it’s likely that your lender has switched you to their Standard Variable Rate which is probably more expensive than other options available. Your home may have also increased in value to the point where you are in a different loan to value bracket (a measure that lenders use to assess the percentage of the property that is actually mortgaged) which might give you access to some cheaper rates. Plus, new deals come onto the market all the time so there might something better that just wasn’t available previously.
Be Mortgage free earlier
Maybe you have some extra cash each month and like the idea of an early retirement? It might be worth doing the sums around what your monthly repayments would look like if you remortgaged over a shorter term. There are also variety of deals that allow for overpayments that might be worth considering if early repayment is an aim.
Perhaps you’d like 2020 to be the year that you turn your property into your dream home. If you have plans to renovate or extend then financing the project through your mortgage could be a cost effective option. It’s likely that a mortgage lender will want to see quotes for the work you intend to get done though.
Get ahead of the game
If your current deal is due to end in the next 6 months, then you can apply for a remortgage now to lock in a new rate as mortgage offers are valid for up to six months. Planning in advance like this can help you avoid even a short term payment shock of reverting to the standard variable rate (which could be considerably higher than your current rate) while you search out and agree a new deal.
Remortgaging to cover the costs of private education or university is becoming increasingly relevant. Provided you have sufficient equity in your property this can provide an option for parents to release cash to pay for education. But don’t hold your breath waiting for a thank you!
So, there you have five reasons you may like to consider starting the new year with a new mortgage. But if you can’t face the research then it’s worth remembering that at Mortgage Confidence we are a whole of market broker and can provide professional advice on all types of mortgage and protection insurance products.
Jo Jingree, our specialist mortgage adviser, is highly experienced with 20 years of mortgage knowledge. She also offers a no obligation 30-minute free phone call to discuss your requirements. So, if you’re looking to improve your financial fitness this year then why not get in touch? It’s guaranteed to be less painful than a gym membership!