More than a third of Britons (36 percent) are worried how they will pay their rent or mortgage, according to a recent Ipsos Poll. Yet, millions of people could save money by moving from their bank’s standard variable rate to a better deal.
As the cost of living crisis continues to bite, one of the biggest expenses for many people right now are mortgage payments.
But despite this, many people don’t remortgage when the time comes which could save them hundreds of pounds a month or thousands of pounds over the course of a year.
Mortgage expert Daniel Knott told Express.co.uk how a person’s mortgage options can significantly change over the course of five years.
He said: “I have recently completed a remortgage for a homeowner who was coming to the end of their five year fixed term product.
READ MORE: ‘An expensive waste’ A quarter of a million more Britons cancel TV
Meanwhile, some homeowners are paying hefty fees to exit their fixed mortgage deals early – before another interest rate rise.
The Bank of England base rate has risen to 1.25 percent, but experts are predicting it could double over the next year.
Mr Knott said it could work for some people: “If you wish to remortgage onto a lower rate and the savings you’ll make on the new mortgage are greater than the cost of early repayment charges and any fees attached to your new mortgage, then remortgaging earlier could be a good financial decision.”
It’s also important to note that people can secure their next mortgage deal up to six months before their current fixed term deal ends.
READ MORE: Britons still waiting for cost of living support could get 30 freebies
Meanwhile, if people can afford to make mortgage overpayments, this is a great way to save thousands of pounds on interest charges.
Mr Knott warned: “Before you overpay on your mortgage you must clarify if your mortgage product has any overpayment restrictions in place.
“Common maximum limits are 10 percent of the original balance or 10 percent of the outstanding balance.
“Any overpayments made over this limit may trigger early repayment charges.”
A single mum from Andover in Hampshire recently spoke to Express.co.uk about how she has completely cleared her mortgage, despite being a single parent to twin girls.
Claire Hattrick was just 47 when she made her last mortgage payment and says that although she had to make a few sacrifices, it was definitely worth it.
“Save in your younger years. It’s amazing how much that little bit of birthday money you got and didn’t spend can help you out later on in life.”
