What the Base Rate rise means for you
During May, the Bank of England increased the base rate for the 12th time in a row. It means that the base rate is now 4.5% which is the highest its been for almost 15 years. Nanson, Managing Director at Your Mortgage Expert in Salisbury discusses what the Base Rate rise means for you.
Why has the base rate increased?
“With the announcement that Inflation was still at 10.1% in March it was perhaps inevitable that the Bank of England were going to increase the base rate. But, the inevitability doesn’t make rising base rates any easier for home owners worried about their mortgages or monthly bills.
“If you’re on a fixed rate mortgage, you don’t need to worry about a rise in interest rates at the moment. Your mortgage rate and monthly repayments will remain the same for your fixed term period whether interest rates rise or fall.
“However, if you are on a tracker mortgage or you are on the Standard Variable Rate, lenders may increase rates. Meaning you will most likely pay more as a result of the base rate rise.”
Should I remortgage now?
“It can be tricky for mortgage borrowers to cut through the noise in the current mortgage market. We believe the need for professional mortgage advice at the moment is more important than ever. And we would advise you to get in touch with us to discuss your options.
“If you are looking for a new fixed rate mortgage it can be confusing for home owners as there isn’t always a direct correlation between the base rate going up and fixed rates increasing. For example, in April, despite interest rates rising, lenders were still cutting the rates on their fixed deals. The fixed mortgage rate you’ll get varies depending on which lender you choose, your deposit size, the price of the property and the length of the mortgage term.
“If you’re on a tracker mortgage or your lender’s Standard Variable rate and you’re concerned about the base rate rise it might be worth looking to see if you would save money by switching to a different deal.
“Whether you’re looking for a fixed rate or a tracker, we would advise you to get in touch with us. We will take the time to research all the options to ensure you make the choice most suitable for you and your circumstances. We research mortgage deals from across the market and keep on top of all the rate changes and mortgage product launches.”
To speak to a member of the mortgage advice team about what the base rate rise means for you, ring us now on 01722 322683 or complete a contact us form and let them know when we can call you back.
The information contained within this article was correct at the time of publication. It is intended for information only and should not be used as a basis for purchasing any products. We cannot be held responsible for something that was correct at the time but subsequently changes or goes out of date. For further information, contact Your Mortgage Expert on 01722 322683.
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