The current Bank of England’s standard base interest rate is 1.75% after having been increased by 0.50% at this month’s Monetary Policy Committee (MPC) meeting. This time last year, the base rate was at an all-time historic low of 0.1%. In comparison to last year, the rate looks much different and it feels much different to household budgets. The latest report on expectations of the need for the MPC to hike the rate further has a forecast of the rate rising to over 4% in the first half of next year. This should serve as a wake-up call to all homeowners that could but have not yet remortgaged.

Inflation is above 10% which is the highest it has been since the early 1980s. The peak height of inflation is set to come next year at above 18%. Such expectations will be pushing the MPC to take aggressive action to control inflation and that will come with more base rate increases.

Lenders, of course, do not offer borrowing interest rates at or lower than the base rate set by the Bank’s MPC. A borrower should expect to see rates higher than the base rate. That means that at 4.0% a homeowner could face remortgage offers with higher rates. For those that choose not to remortgage at the end of their mortgage term and are moved to their lender’s standard variable rate (SVR), the rate could be even higher. In some cases, the average SVR is double that offered with a remortgage.

The interest rate in basic terms is the cost of borrowing. While one is expected to pay back the amount borrowed in a loan, the level of cost in borrowing is determined by the choice of interest rate when there is a mortgage or remortgage offer. Certainly, one should seek to gain the lowest interest rate possible to keep from paying more than necessary.

There are some homeowners that are planning ahead and are choosing to not wait until their current mortgage term ends. Rather than pay the interest rate available next year, they are instead taking a penalty fee for ending their deal early and remortgaging now. With a fixed rate remortgage, they can lock in their chosen interest rate and save money since they will be protected from any future rate increases during the length of their term whether that is two-years or ten-years.

There are millions of homeowners that are nearing the end of their mortgage term within the next six months. Most will have obtained their loan during the time when the base rate was at its historic low, and if the forecasts are right, they will be facing the highest rates in decades.

Taking a proactive approach to facing higher inflation, higher interest rates, higher costs of energy and a possible lengthy recession is important. Experts encourage homeowners to shop for a remortgage and determine if they could find savings, protection from paying more, and possibly for some homeowners get cash in hand.

Shopping for a remortgage is easy to do online. In a matter of minutes, after a few answered questions, a homeowner could have a quote to review. Going website to website of remortgage lenders will allow a homeowner to determine what offers are available. Shopping online with a remortgage broker could offer many quotes from various lenders in which to compare at one website. It could also offer an exclusive broker deal from lenders not offered directly to customers.

Some of the most popular remortgage products are fixed rate deals which locks in the interest rate for the term and offers peace of mind against rising rates and another popular choice is the equity cash release remortgage. The equity cash release turns built up equity into cash that the homeowner can use as they desire. While it can pay for a holiday, auto repairs, or even a wedding postponed by the pandemic, there are other uses as well. Some homeowners are upgrading and improving their property heating systems to save money this winter. How to spend the money is totally up to the homeowner.

There are many benefits and opportunities in remortgaging, and with the ability to get quotes in hand in minutes online, it is a smart strategy and a good first step to shop for a deal. The sooner the better as the next MPC meeting is in the middle of September which is only weeks away.