According to UK Finance, there are approximately 430,000 homeowners on two-year fixed interest rate deals that will expire by the end of 2022. They would have chosen their interest rates when the Bank of England’s standard base rate was at an all-time historic 300 plus years low of 0.1%. The current rate is now 1.75%, which means their cost of borrowing is going to be much more expensive. 

The Bank’s Monetary Policy Committee (MPC) started increasing the base rate last December. There has been a majority vote for an increase at each of the last six consecutive meetings. 

Newly released data has shown that the cheapest two-year fixed rate mortgage has risen from a bit more than 1.30% in January to almost 3.50% in August. The increase is more than double, and that is for the cheapest offer. Some would not qualify for the least expensive interest rate offer and therefore would be paying even more.

Experts encourage all homeowners to shop for a remortgage now, as there is not a minute to waste. A remortgage has the possibility of offering savings, peace of mind while interest rates continue to rise, and for some even cash in hand. With an equity cash release remortgage, a homeowner could have money for any necessary need as well as secure an affordable rate and fixed interest rate.

Homeowners that have allowed their mortgage term to lapse but have yet to remortgage have been moved to their lender’s standard variable rate (SVR) which is likely a much higher rate than could be found with a remortgage. They could also be victims of ever rising rates if they don’t take action to secure a fixed rate remortgage soon.

Those mortgage holders that are close to having their term end have two choices. They could wait until their term ends and choose from deals then, or they could as some have done and take a penalty fee to end their deal early. In doing so, they have choices of interest rates available now versus later on when they could be higher. Shopping early before the term ends is a good strategy for it allows a homeowner to determine what deals are available and how they could benefit their current and future financial situation.

Shopping online is quick and easy. Simply going website to website of remortgage lenders or visiting a remortgage broker site could put quotes in hand from various lenders. It should be noted that remortgage brokers could offer exclusive deals from lenders that are not offered directly to customers.

A good place to start for any homeowner is to be reminded of when their current term ends, their current interest rate level and their type of loan, such as if it is currently a fixed rate or not. With that information, it is then simple to get quotes and determine whether it is time to remortgage now or perhaps wait.

The next MPC meeting is 15 September. There is a strong possibility that another interest rate hike could occur. If another 0.50% increase is voted for, such as happened at the August meeting, the rate will top 2.0% with a new standard base rate of 2.25%.