If you have a fixed-rate mortgage term coming to an end, you may be wondering what happens next.
With the ongoing cost of living crisis and bank interest rates on the rise, many lenders have increased mortgage rates so your mortgage payments could increase on renewal if you are coming out of a fixed-rate mortgage.
Many people try to negotiate a new fixed rate with their current provider – but there are other options available to you which may be a better fit and could save you money.
What happens when your fixed-rate mortgage term ends?
When your term ends the agreed rate you were paying moves to your lender’s standard variable rate (SVR). The SVR is often higher than what your fixed rate would have been so your monthly mortgage payments will most likely increase at this point.
Do you have to remortgage after the fixed-term deal ends?
There is no mandatory requirement for you to remortgage and neither do you have to do this with your current provider only. If you do decide to remortgage, you can lock in a new fixed rate – either with your current provider or a new one. Many people go down this route as they like to secure the lowest interest rates available and then have a set mortgage repayment each month.
You have the option to change your mortgage at this juncture, you can move providers, change your mortgage type, remortgage to a new fixed rate, or simply stay on the SVR. You can even extend the length of your entire mortgage during a fixed-rate term, but it depends on your provider.
If you are simply looking to extend the term of your fixed rate, you’ll need to renegotiate that new mortgage deal either with your current provider or look elsewhere. Doing so before your term ends means you may be subject to penalty charges.
How can you compare the best current fixed-rate mortgage deals?
While many comparison websites claim they can help you compare current deals, your best bet is to approach a mortgage broker like Steel & Co. who have access to multiple lenders and can secure the right mortgage for you thanks to our experience and depth of knowledge of the entire mortgage market. We will compare the best fixed rate deals with different terms, from different lenders, to see which mortgage is most suitable for you.
Not only could an expert mortgage broker such as Steel & Co. help you save money on your mortgage, we also remove the time and stress involved when comparing current deals on your own so there are many reasons a mortgage broker could be the right choice for you when remortgaging.
If you need professional, friendly advice from an expert mortgage broker, please call Amanda at Steel & Co. on 01502 446000 or fill out the contact form on our website.
Think carefully before securing other debts against your home. Your home or property may be repossessed if you do not keep up repayments on your mortgage.