As the base rate has fallen further to an all time low of just 1%, mortgage interest rates are coming down too. Those with interest only mortgages have seen a huge drop in their monthly repayments with some lucky enough to have grabbed deals where they are paying no interest at all.
Great news for variable rate mortgage borrowers who have seen their disposable income drastically increase. However the best advice and one that many lenders are encouraging are overpayments. With interest rates so low you why not continue to make the same repayments you were making four months ago when the base rate was 5%. Taking this opportunity to overpay on your mortgage, while mortgage interest rates are so low, means that you can potentially take years off your mortgage.
Lenders rates do vary quite considerably so it is worth taking the time to search the whole market before deciding on the best deal for you. If you are a current mortgage holder check what rate of interest you are paying as well as conditions of the mortgage for example exit fees. Even if you are tied into for a term it may be worth it to pay the exit fees and benefit from lower mortgage interest rates.
There are thousands of different mortgage products on the market. Using the services of a mortgage broker can take the pain out of searching for the right mortgage for you. Some lenders charge a fee while many are fee free mortgage brokers; you can get just as good as advice from the fee free mortgage brokers as the paid ones. You can also benefit from the expert advice available; many brokers have several years of experience of the market.
One final thing to consider before accepting a mortgage deal is if you go for a fixed rate mortgage, think about what the market may be like when your fixed rate deal ends. Many lenders are offering very competitive five year fixed rate deals however interest rates may be high when the deal ends. It might be more beneficial to stay on a variable rate until the market starts to recover and then tie into a fixed rate deal. A broker will be able to advise you on this matter.
