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Mortgage expert shares tips to secure ‘cheapest deals’ as lenders slash rates | Personal Finance | Finance
With millions of low fixed-rate mortgage deals expected to come to an end this year, Britons are being urged to plan ahead to secure the “cheapest deals possible”.
While lenders have been cutting interest rates recently despite another Bank of England Base Rate rise to 5.25 percent, deals still remain largely expensive leaving many questioning the best course of action to secure a lower rate.
Claire Flynn, mortgages expert, commented: “While inflation has slowed to 7.9 percent, it’s still far above the Bank of England’s target of two percent, meaning [the Base Rate] could increase further over the next few months.
“While mortgage borrowers might be relieved to hear some of the UK’s biggest lenders are reducing rates, those due to remortgage still face much more expensive deals than in recent years. If you’re in this position, while you remain likely to face a rate increase, there are a few steps you can take to improve your chances of getting the cheapest deal possible.”
Look into remortgaging options early
According to Ms Flynn, mortgage offers are usually valid for around six months, which means people can secure a new deal ahead of time and switch automatically when their current deal ends. This will help avoid facing steep early repayment charges.
Ms Flynn added: “This also stops you moving to your lender’s standard variable rate, which is normally more expensive than other deals in the market. If you opt for a fixed-rate mortgage, this also means you won’t be impacted by any further rate increases. And if rates reduce before you change to the new deal, you can switch again.”
Consider overpaying your mortgage
For those currently on a low rate who can afford to pay more, doing so might allow people access to lower loan-to-value deals when they remortgage.
Ms Flynn said: “This normally means better rates. You can do this monthly or in a lump sum. But lenders usually have a limit on how much you can overpay before they charge a fee.”
However, Ms Flynn noted that those who are on their lender’s standard variable rate or are opting into certain tracker deals, usually don’t face early repayment fees so they can “overpay as much as you like”.
Ms Flynn said: “Contact your lender or check the terms and conditions of your deal to find out your overpayment options.”
Speak to a whole-of-market mortgage broker
An independent adviser can compare mortgage deals from across lots of lenders to find the best deal for an individual. While it can be tempting to stick with the same bank or building society, Ms Flynn said: “It’s worth looking at all of the options.”
She added: “In the current market, there can be significant differences in the rates on different mortgage deals. So, getting expert advice could help you find the best deal and save you a lot of money.
“If your mortgage rate has increased and you’re concerned about making your mortgage payments, speak to your lender.”
Due to the increases in rates, many UK lenders have signed up to the mortgage charter to support borrowers. Measures of this charter include the option to extend a mortgage term or switch to interest-only payments for a temporary period of time to reduce monthly payments.
Ms Flynn noted: “But there are a number of aspects to consider before taking either of these routes. For example, you might end up paying more in interest overall. Make sure you speak to your lender and consider all the potential impacts before making a decision. You may also want to consult a third-party charity that can offer impartial debt guidance, such as Citizens Advice.”
Mumbai:
The Indian equity benchmark indices opened higher on Friday amid positive global cues, as buying was seen in the IT, pharma and auto sectors in the early trade.
At around 9.27 am, Sensex was trading 265.3 points or 0.33 per cent up at 80,066.81 while the Nifty added 89.85 points or 0.37 per cent at 24,336.55.
Nifty Bank was down 222.85 points or 0.40 per cent at 54,978.55. The Nifty Midcap 100 index was trading at 54,980.80 after increasing 10.95 points or 0.02 per cent. Nifty Smallcap 100 index was at 16,903.30 after declining 60.20 points or 0.35 per cent.
According to market watchers, “after a positive opening, Nifty can find support at 24,200 followed by 24,100 and 24,000. On the higher side, 24,500 can be an immediate resistance, followed by 24,600 and 24,700.
“The charts of Bank Nifty indicate that it may get support at 55,000 followed by 54,700 and 54,500. If the index advances further, 55,500 would be the initial key resistance, followed by 55,800 and 56,200,” said Hardik Matalia, Derivative Analyst of Choice Broking.
Meanwhile, in the Sensex pack, TCS, Tata Steel, Maruti Suzuki, Eternal, ICICI Bank, SBI, HDFC Bank, Infosys, M&M and Tata Motors were the top gainers. Whereas, Axis Bank, Tech Mahindra, Nestle India and IndusInd Bank were the top losers.
In the last trading session, Dow Jones in the US added 1.23 per cent to close at 40,093.40. The S&P 500 climbed 2.03 per cent to 5,484.77 and the Nasdaq added 2.74 per cent to close at 17,166.04.
In the Asian markets, Jakarta, Bangkok, Seoul, Hong Kong, China and Japan were trading in green.
According to analysts, US markets extended their rally on Thursday as investors snapped up hard-hit technology stocks, helping boost the S&P 500 out of correction territory.
The foreign institutional investors (FIIs) bought equities worth Rs 8,250.53 crore on April 24. However, domestic institutional investors (DIIs) sold equities of Rs 534.54 crore on the same day.
(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)
Mumbai:
Indian equity markets are trading in the red as tensions soar between India and Pakistan over the Pahalgam terror attack in Kashmir. Sensex, the 30-share BSE benchmark, has crashed over 1,000 points and is now trading below the 79,000-mark. Nifty, the NSE index of 50 shares, fell below 24,000 points.
The markets went up in early trade, driven by a global rally and fund inflows, but the momentum got lost thereafter, and it gave up the initial gains.
The markets are also upset by unimpressive March quarter earnings by Axis Bank, the third-largest private sector bank of the country. The bank’s shares have fallen 4.65% after reporting a decline in quarterly profit from Rs 7,130 crore in the year-ago period to Rs 7,117 crore.
Besides Axis Bank, major laggards include Bajaj Finance, Bajaj Finserv, Tata Motors, and Tech Mahindra. On the gaining side are TCS, Infosys, Reliance, HCL Tech, HDFC Bank, and ICICI Bank.
At least 26 civilians were massacred by terrorists in a tourist hotspot known as ‘Mini Switzerland’, leading to both countries pulling out their diplomatic staff and suspending visas issued to the other nation’s citizens. (Follow live updates here)
The latest flare-up at the Line of Control was speculative firing by Pakistani troops, which is being seen as an attempt to provoke the Indian side. Indian troops retaliated effectively against the firing from multiple Pakistani posts.
As Indian equities braced for the impact, global equities, including the Asian markets, were charting in the positive territory. South Korea’s Kospi index, Tokyo’s Nikkei 225, Hong Kong’s Hang Seng, and Shanghai SSE Composite were all in green.
Similar trends were seen in US equities, too. Last evening, Nasdaq Composite closed 2.74 per cent higher. S&P 500 jumped over 2 per cent and Dow Jones Industrial Average surged 1.23 per cent.
Mumbai:
Equity benchmark indices Sensex and Nifty declined in early trade on Thursday amid profit-taking after a seven-day rally and muted trend in Asian markets.
The 30-share BSE benchmark declined 242.01 points to 79,874.48 in early trade. The NSE Nifty went down by 72.3 points to 24,256.65.
In the past seven trading days, the BSE benchmark gauge zoomed 6,269.34 points or 8.48 per cent and the Nifty jumped 1,929.8 points or 8.61 per cent.
From the Sensex firms, Eternal, Bharti Airtel, ICICI Bank, Mahindra & Mahindra, HCL Technologies, Reliance Industries, and HDFC Bank were among the laggards.
IndusInd Bank, Tech Mahindra, Nestle, Bajaj Finance, Axis Bank, and Tata Motors were among the gainers.
In Asian markets, South Korea’s Kospi index, Shanghai SSE Composite, and Hong Kong’s Hang Seng were trading lower while Tokyo’s Nikkei 225 quoted in the positive territory.
US markets ended sharply higher on Wednesday. Nasdaq Composite jumped 2.50 per cent, S&P 500 surged 1.67 per cent and Dow Jones Industrial Average climbed 1.07 per cent.
Global oil benchmark Brent crude climbed 0.12 per cent to USD 66.20 a barrel.
Foreign Institutional Investors (FIIs) bought equities worth Rs 3,332.93 crore on Wednesday, according to exchange data.
The BSE benchmark jumped 520.90 points or 0.65 per cent to settle at 80,116.49, the highest closing level since December 18, on Wednesday. The Nifty rallied 161.70 points or 0.67 per cent to 24,328.95.
(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)
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