With interest rates at an all-time low, you might be thinking: should I refix my mortgage? It’s a topical question, and the answer doesn’t just depend on the rate you can get now – It’s also about your plans and how a different rate might affect your future mortgage needs.
So here are some key things to consider…
What’s your situation?
Perhaps you are planning on selling your house soon, or you may be expecting to receive some extra money soon…
Whatever your situation is, take some time to think about it, and what you’d like to achieve over the next one to five years. This will then help you decide the right structure for your mortgage. For example, if you want to pay your loan off quicker, re-fixing it may not be the best option.
On the other hand, if you are planning on staying put and don’t envisage many changes, the security of a fixed-rate loan may be right for you.
Fixed or floating?
While you might think the lowest interest rate possible is the best option, there are pros and cons to each of these rate types.
While the floating rate can increase at any time, for example, it can also decrease at any time – and if that happens, you won’t have to wait to take advantage of a lower interest rate.
Plus, if you have some extra funds to put towards your mortgage, a floating rate allows doing this with no penalty (which is not the case with fixed rates).
Having said that, it’s true that interest rates have never been this low, so fixing now can potentially save you money. Besides being the money-saving opportunity, fixed rates can also give you peace of mind, as you’ll know exactly what your payment will be for the fixed-rate period. In the meantime, if the rates rise, you’ll be enjoying a lower rate than is currently available…
DIY or use a mortgage adviser
If you’ve got your mortgage in place, you no longer need a mortgage adviser, right? Well, not quite. Home loans are long-term commitments, and as mortgage advisers, we are here to help you every step of the way. So, whenever you need to refinance or would like to refix your mortgage to take advantage of good rates, get in touch with the Team at Mortgage Link.
We work with a wide range of lenders, and can help you navigate all the terminology and different loan and interest rate structures, to make sure you get the right one for your situation.
If it’s ‘refix time’ – or just time to give your mortgage a health check – give us a call. We’re here to help with all your lending needs.
Disclaimer: Please note that the content provided in this article is intended as an overview and as general information only. While care is taken to ensure accuracy and reliability, the information provided is subject to continuous change and may not reflect current developments or address your situation. Before making any decisions based on the information provided in this article, please use your discretion and seek specialist advice.