Mortgage holders have breathed a collective sigh of relief after the Bank of England decided to keep its base rate at 0.5 per cent once more in the September meeting.
Although that level`s remained the same for years now as the central lender tries to stimulate the economy, there`s been talk of it increasing sometime soon and in the previous month`s Monetary Policy Committee vote, two members actually voted for an increase; something that`s not happened for three years.
However, the Bank`s governor, Mark Carney, has moved to reassure people that when there is a rate rise, it would be small and gradual. It`s also widely expected that the base rate won`t get anywhere near the highs of previous years, leading to lower rates being the new normal.
In spite of this, you`re likely to get a cheaper deal if you fix your mortgage while the Bank rate is at 0.5 per cent compared to what may be available if and when the rates go up. Many lenders rates are aligned to changes in the bank base rate so it is logical that if base rates go up so will some of the mortgage lenders deals. You can look into variable, fixed and tracker remortgage or mortgage deal by getting in touch with First Choice Finance, who give advice on the lenders available from their panel.
A dedicated adviser will take your details and work through your needs and requirement to try and locate the most suitable mortgage for your scenario from our mortgage products. Any quotations are then presented this on a no obligation basis, so you`re free to turn it down if you don`t think it`s right for you.
If you want to discover more about what we can do about fixing your mortgage rate, or even finding a lower one, head to firstchoicefinance.co.uk or call us and speak to an adviser, from a landline it`s 0800 298 3000 and on a mobile it`s 0333 003 1505.
As well as potentially saving you money, fixing your mortgage can offer you peace of mind too - something that a lot of homeowners are in need of, according to an Ipsos Mori poll carried out for the Halifax.
It showed that 13 per cent of people are worried that they won`t be able to make their monthly payments if the base rate causes their mortgages to go up by £50 a month. On one of the more broad questions in the survey, 41 per cent revealed that they were concerned about the interest rate going up, regardless of how much it added to repayments.
Analysts currently think that an increase of 0.25 per cent could add around £250 annually to each mortgage, although a lack of wage growth may prevent that happening quite yet.
Bank of England figures show that wages have effectively fallen each month since September 2009 due to salaries not keeping up with the cost of living. This was shown starkly in July 2014, when inflation went up by 1.6 per cent, while wages decreased by 0.2 per cent.
Even if the base rate doesn`t go up straight away, you may still find yourself with smaller repayments to make if you switch your mortgage with the help of a broker. That`s according to the Nationwide`s Ian Andrew, who has written on the mortgage strategy website about the benefits of intermediaries.
He notes that with all the uncertainty over the future of mortgages, brokers` knowledge and experience is invaluable so that customers manage to find the best deal for their circumstances. Of course once you fix your rate you are then tied into it for a while with penalties should you exit early so this must be kept in mind when you decide to fix your mortgage or not.
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