In a time of higher interest rates and rising living costs, it’s essential to ensure you’re getting the best deal on your mortgage. We asked our founder and Managing Director, Monica Bradley, for her top tips on achieving this.
What can we do to ensure we’re getting the most competitive mortgage deal?
You’ve got to understand what your current rate is and when it’s coming to an end. In a time of rising interest rates which are now at their highest since 2007, you need to be aware of what’s available on the market, which means talking to a mortgage broker. They will tell you about the different types of mortgages and give you a financial opinion of where things are going. There’s been a real shift over the last six months; even a half per cent interest rate saving can be a huge amount as our average mortgages now are obviously much higher than they were some years ago.
How often should someone be looking to review their mortgage deal?
Every couple of years. It’s all about awareness and knowing when your rate comes to an end. The variable rates that the banks have now are much higher, so it will cost an awful lot more in interest if someone’s fixed-rate deal ends and they go onto a standard variable rate. Put a note in your diary six months before the end of your term to start talking to a broker.
You often talk about how people can pay less interest on their mortgages. How can we do this?
I talk to all my clients about the ability to make overpayments on their mortgages. I’m really passionate about people understanding what just a small overpayment of even £50 per month will do. It will shorten the term of the loan, and equally, it will make you pay the balance off much quicker had you not made an overpayment. So it’s being aware that this option exists and speaking to your broker about how to do it.
Why is it important to have a long-term strategy for your mortgage?
It’s really important to understand where you want to be in terms of your planning and your mortgage. When your mortgage adviser knows what your plans are long term, they can come up with the relevant product which suits your needs. So are you looking to move? Are you looking to downsize? Are you looking to retire? These are all really relevant questions. You might have kids going to university and might need to fund some university fees. It’s about making sure you take control and plan ahead.