Current mortgage interest rates
Recent research has revealed that four out of every five borrowers in the UK are paying over the odds for their current mortgage. Interest rates on mortgage products are at their most competitive level in years, yet a large proportion of current mortgage owners are unaware how much they could save on their monthly repayments just by simply switching to a different mortgage product with lower interest rates. What's more finding better mortgage interest rates is so easy to do - borrowers can even apply to switch their mortgage online!
How much could I save by switching my current mortgage to a product with lower interest rates?
More than a third of all mortgage owners are on a standard variable rates mortgage product with a typical interest rate of 6.75%. Some borrowers have opted for this rate out of choice, while others have ended up on a standard variable rates mortgage after their discounted or fixed interest rates mortgage product expired. But, with low current mortgage interest rates available on new fixed, capped and flexible mortgage products, borrowers can now easily save huge amount of money every year.
As an example, on a standard variable rates mortgage of £100,000 at a current APR of 6.75% and with a term of 25 years, homeowners will be paying in the region of £700 per month for their current mortgage. If they were to move their mortgage to a fixed mortgage rates product offered by a reputable lender at an APR of 4.6% (several are offering fixed rates of around 4.5% to 4.8%), then they would reduce their monthly repayments to around £570. This equates to a saving of more than £1500 per year!
So, what should I do if I want to switch mortgage product?
The first thing you need to do is check the policy on your current mortgage product. Some have tie-ins that prevent you from switching your mortgage to another provider without incurring a financial penalty. If you would be penalised then you need to assess whether the savings you would make by switching your current mortgage product outweigh the penalty that would be charged by your current mortgage provider when you do so.
Current mortgage interest rates information is published on the Internet and in the financial sections of the broadsheet newspapers. You can also gain information on current mortgage interest rates through a broker or independent financial advisor, both of whom could help you track down the best mortgage interest rates on your behalf.
Once you have found a new mortgage product with low current mortgage interest rates, then it is worth consulting your current lender to see if they can better your deal. If you go to them with a brochure or print out of the new mortgage product and the interest rates offered, then you'll be in a stronger position to negotiate current mortgage interest rates with them. If they're not interested in retaining your custom, then its time to make that switch!