Free impartial help for property owners hit by mortgage rate rise
Several hundred thousand of Santander mortgage customers have just been alerted to the fact their standard variable mortgage rate (SVR) will rise from 4.24% to 4.74%.
The Money Advice Service has a wide range of impartial resources to help home-owners who are being hit with an unexpected rise in their monthly mortgage payments.
The independent Service, set up by government is urging homeowners to review their options using its range of free resources, at: moneyadviceservice.org.uk/mortgagereview.
Its own research - conducted for its Stay on Top of Your Mortgage campaign - revealed that 74% of mortgage holders didn't know how an interest rate change of one percentage point could affect their monthly outgoings.
Jane Symonds, Head of Service Delivery at the Money Advice Service, says: "It pays to stay on top of your mortgage, and review it regularly. Ask yourself two key questions: whether you could cope with an unexpected rise - even a small rate rise might significantly dent your household budget; also consider whether your current mortgage as really as competitive as the best new deals on the market today?
It's a good idea to review your mortgage at least once a year to check whether you should switch to a better deal. Remortgaging can help you cut costs. You can save hundreds - perhaps thousands - of pounds by shopping around. Keep a regular eye out for better mortgage deals - new ones are coming on to the market all the time, and if you're not locked in to a fixed period deal with an early repayment charge it could be worth your while changing lenders (remortgaging) at any time.
At the very least, you should review your mortgage:
1. when interest rates change - because this will affect how competitive your current deal is
2. when your current mortgage deal comes to an end - as your rate may increase, and
3. once a year if you're not tied in to deal with early repayment penalties - to see how your current deal compares to new deals that have come onto the market".