Avoiding paying more than you need to in interest rates and keeping loan repayments as low as possible is the secret to staying on top of your personal finances, according to This is Money. With that in mind, it may be time to start looking for a new loan or mortgage.
Find a New Mortgage
Currently, 4 million home-owners are paying a standard variable rate (SVR); this is what mortgages revert to when a fixed-term deal ends. If you are paying a SVR, chances are you could benefit from a new mortgage. SVRs often have high interest rates and little security, as banks can change the rates whenever they wish. Predictability is important when managing personal finances and, with low interest rates and banks willing to lend, finding a deal that suits your situation is not as difficult as you may expect.
Do The Sums
If you are looking for a new mortgage it can be tempting to simply look for the mortgage with the lowest rates, but depending on the size of your mortgage this might not be the best course of action. Try to look beyond interest rates and take into account the arrangement fee, especially if you are opting for a two or three-year mortgage deal. An arrangement fee can cost you hundreds of pounds and makes little sense to be paying this every two or three years. A general rule is that the size of your mortgage decides what kind of deal you should opt for. If your mortgage is £120,000 or less you should look for a deal with higher rates and a lower arrangement fee. If your mortgage is £250,000 or higher you should look for a deal that gives you the best possible interest rates for a slightly higher arrangement fee.
