Market News
Your home may be repossessed if you do not keep up with your mortgage payments
14th September 2023
Let’s start with some facts that I’m sure you have heard in the media. Yes the base rate is at a 15 year high. Yes mortgage rates have increased rapidly over the last year. There is no way to sugar coat that, those are the facts at the moment.
There are ways you can reduce the impact of this though with the right advice.
• You can extend the term of your mortgage.
• You can change to Interest Only or Part Interest Only.
• If you have a mortgage and are still benefiting from a lower rate, you can overpay now so that you balance is lower when you need to remortgage.
None of these are without their downsides but can help to reduce monthly outgoings for now to help with cashflow, if necessary. You absolutely will need some clear advice on all aspects of this though before proceeding. That’s where we come in!
Give us a call and we can balance all your options to help find the most suitable way forward.
Mortgage Charter
Due to the rising interest rates, some lenders have signed up to a new Charter that allows their customers to make temporary changes to their existing mortgages. For example, if you are struggling to keep up with payments your lender may allow you to temporarily switch to an Interest Only mortgage for 6 months or even increase your overall mortgage term for 6 months to help reduce your payments.
Not all lenders have signed up and not everyone will be eligible. You can find more info on the Government website.
As always we recommend contacting your lender as soon as possible to discuss options if you are struggling to keep up with your payments.
Market Projections
A question we get a lot is ‘What do you think will happen with rates in the near future’ and, being honest, it’s very hard to forecast. At the start of the year people thought the base rate would peak at 4.5-4.75% by the end of 2023 and then would start to reduce towards the end of 2024. Here we are though, mid 2023 with a base rate of 5.25%.
The latest projections are that they expect rates to continue to rise until the middle of 2024 with the base rate potentially reaching 5.75%, according to TSB’s Chief Economist, David Fenton. After this, rates will stabilise but won’t reduce straight away. They may come back down to where we currently are by the middle to end of 2025. Honestly, though, it is constantly changing and is hard to predict.
We certainly keep our eye on the market and will be able to offer the right advice at the time to make sure you have the best rate available at the time.
If you are worried about your mortgage, thinking of moving or need to remortgage soon, GET IN TOUCH!
We are here to help.
Email: Enquiry@lloydwellsmortgages.co.uk
Tel: 0117 453 0330
The information contained within was correct at the time of publication but is subject to change.
