Compare Mortgage Rates
Homeowners who fail to compare mortgage rates from different mortgage providers could needlessly be spending hundreds of pounds more than they need to every year. Increased competition between mortgage lenders, together with low interest rates have seen mortgage rates drop to their lowest level in years. Additionally, many mortgage lenders are increasingly offering incentives to customers to switch their mortgage by providing reduced mortgage rates for an introductory period, low credit arrangement fees and free legal costs.
How much could be saved by choosing to compare mortgage rates?
By choosing to compare mortgage rates, homeowners could easily save hundreds of pounds per year on their mortgage repayments. Reducing mortgage rates by just 0.5% will translate into a saving of around £40-£50 per month on mortgage repayments. In more extreme cases, homeowners who have not chosen to compare mortgage rates in the last 3 or 4 years may find themselves saving thousands of pounds each year!
Homeowners should not only compare the interest rates of their mortgage, but should also compare different mortgage products to ensure they are getting value for money. For instance, homeowners on a standard variable rates mortgage at an APR of 6.5% could compare their mortgage to a fixed rates mortgage deal. Some of the best fixed mortgage rates are currently as low as 4.5% fixed for two years. On a mortgage of £100,000, this would mean a saving of c.£120 per month! A fixed rates mortgage would also protect you for two years from the effects of interest rates rises.
If you are on a fixed rates mortgage deal though, it is important to compare the standard rates that will apply to your mortgage once the fixed period expires. If you do not renew your fixed mortgage deal or fail to compare your deal at the time against other mortgage offers, then you might find yourself paying interest rates above what you were initially stuck with, even if there are no general increases in the base interest rate.
How can I compare mortgage rates?
You can easily compare the interest rates of mortgages and the different mortgage products available on the Internet. Many sites offer mortgage loans calculators, so you can compare how different mortgage rates will translate into monthly repayments. Some will even provide you with a mortgage repayment schedule. Should you find a mortgage product that you like after you compare them, then in many instances you can apply for it online too.