- The average two-year fixed mortgage rate has surpassed 6%
- Thousands of homeowners are choosing to remortgage in anticipation or more rate hikes
Back in December, the average two-year fixed deal was just 2.34%. As of October, a typical two-year fixed deal is now 6.36% – the highest it’s been for 14 years.
Earlier this month, the Royal Institute of Chartered Surveyors (RICS) warned that “storm clouds” in the housing market were visible.
Recently, major lenders such as Halifax, NatWest, Nationwide and Virgin Money have all increased their rates, and experts suggest we can continue to expect more increases through the new year.
Now, in an attempt to get the best deal possible before rates increase further, UK homeowners are rushing to remortgage.
Why are homeowners remortgaging?
By switching to a lower rate than what they’re currently on, homeowners can reduce the size of their monthly mortgage repayments, and pay less interest over time.
Remortgaging can also provide an opportunity for homeowners to consolidate high-interest personal debt, on things like credit cards and loans.
By essentially moving their high-interest debt to a low-interest remortgage deal, homeowners can not only stop worrying about keeping on top of multiple outgoings throughout the month, but also feel assured that they’re going to be paying less interest on their debt over time.
Many even use remortgaging as an opportunity to release cash for things like home improvements. In fact, Brits spent £110bn on home improvements over the course of the pandemic.
Am I eligible for a low-interest remortgage?
To find out if you’re eligible for a low-interest remortgage, take our quick 30-second quiz below. You may be able to reduce your monthly outgoings substantially.
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Why are homeowner remortgaging?
- Rates are expected to continue increasing.
- Many are switching to a lower rate to reduce mortgage payments.
- Personal debts can also be consolidated into the deals.
- Some are releasing cash for home improvements.
There may be a fee for mortgage advice if you decide to proceed. If you are thinking of consolidating existing borrowing, you should be aware that you may be extending the terms of the debt and increasing the total amount you repay. The savings you make from remortgaging will vary depending on your circumstances. Think carefully before securing other debts against your home. Your home may be repossessed if you do not keep up repayments on a mortgage or any other debt secured onto it. Nothing on this website constitutes financial advice. MoneyAdviceExpert.co.uk aims to match you with the right financial advice and introduce you to a qualified financial advisor. This website provides information only, and the choice of product is for you alone to choose. As an introducer we process the information you provide us and we may pass this onto our trusted third party lenders and brokers. All credit is subject to you being a UK resident, aged 18 or over, and subject to your personal circumstances. All lenders operate responsible lending policies and as such credit is subject to status and affordability.