Even with the wide number of cheap remortgages available to homeowners there are many that have refrained from getting a new deal.  Having had their current mortgage deal end they have moved upon their lender’s variable rate and have been content to pay the low interest rate available there without getting a new deal.  This could be very risky now that lenders are becoming more cautious about lending and are likely to both pull their cheapest remortgage deals but also hike their variable rate.

For homeowners that are paying interest based on their lender’s variable rate they will be shocked when the rates begin to rise and they do so without warning and without any movement in the standard base interest rate set by the Bank.  Lenders can increase or decrease their variable rate without any change coming from the Bank of England’s Monetary Policy Committee.  If a homeowner has a tight budget any increase in their mortgage debt’s interest rate could prove financially destructive to their ability to keep their payments up to date.

If lenders pull their cheapest rates then homeowners will have missed out on securing a rate that could have saved them money for a long period.  Already some lenders have moved their interest rate offerings upward.  Not every homeowner can benefit from a remortgage but if one can prove financially beneficial then a homeowner should seriously consider shopping around now.  Lenders can pull their deals from the market without any warning and so waiting around could prove costly over the course of many years.