Interest Rate Cut
The Bank of England recently cut its base rate to 0.25% from 0.5%. The effect of this varies by the type of mortgage you have. A tracker rate will track the Bank of England base rate, typically above a given percentage, thus a change in the Bank of England base rate downwards will see mortgage payments reducing.
What will this mean for me?
If you are on a tracker mortgage, the savings are approximately £11.43 per £100,000 borrowed on an average 25-year repayment mortgage or £20.84 if interest only per month. Fixed rate mortgages are unaffected
I’m On A Fixed Rate, Can I Get My Mortgage Payments Lower?
You can, but you will probably have to pay an Early Repayment Charge (ERC). Mortgage Rates were at a record low according to the BBC in July, so even with an early repayment charge it may be possible to save you money. Speak to one of our advisers to see if this is cost effective.
My Mortgage Is Currently On Standard Variable Rate, Could I Save Money?
Furthermore, with 34% of the market on Standard Variable Rate (SVR) according to Virgin Money, securing a mortgage at record low rates could be the right thing to do. In certain circumstances, you may be able to raise funds on your home or Buy To Let, for things like home improvements. Virgin money also state that 70% of people on standard variable rate could save money by moving to a fixed rate mortgage. An advisor will help guide you through whether or not a remortgage is the correct decision.
Have you heard?
Members of the Express Mortgages team will be taking part in the Wigan 10K to raise funds for Caudwell Children. Read more about the fundraising here.