Homeowners are taking advantage of the current low interest rates available with remortgaging. The interest rate is the cost the homeowner pays for their loan. There can be other costs involved with a remortgage or mortgage, but basically the main cost is determined by the interest rate. The lower the rate, the less one will pay and that is why homeowners are seeking a low rate now before the Bank of England’s Monetary Policy Committee (MPC) raises the rate and makes borrowing more expensive.

Current rates offered by lenders could be their historic all time low offer. The MPC made history when the pandemic took hold of the UK’s economy last year and lowered the rate to 300 plus year historic low. Lenders soon followed in response to the MPC and offered lower rates. As borrowers took notice, the lenders started to compete for attention of borrowers and offered better and better deals. Now rates might be the lowest they will ever be and savings could be substantial.

It could be easy to expect low interest rate offers year after year as we have been far from what was considered normal for more than a decade. However, the low interest rate levels of today are not going to last much longer according to experts. In fact, it is expected that there could be many increases in 2022 and even more in 2023. 

By securing a fixed rate remortgage, a homeowner can lock in a low interest rate for the length of the term and not only save now, but also when rates begin to rise. For instance, if the homeowner secures a five year fixed rate remortgage, no matter how high the rates rise, the homeowner will pay on the low rate for the five years that they secured when they remortgaged. It could help them escape increase over increase for the length of the deal. 

Many homeowners use the ability to save money on a fixed rate deal when rates increase to prepare for paying higher rates later on. 

Experts warn that rates could very well increase next year, and encourage homeowners to shop as soon as possible for a remortgage and secure a low interest rate to keep from paying more than necessary. Online searches are an easy and quick way to get quotes to determine what remortgage offers are available. Homeowners can visit websites of lenders or visit a website of a remortgage broker and get quotes from many lenders at a time.

The homeowners that had their mortgage deal end and did not remortgage and were moved to their lender’s standard variable rate (SVR) should especially shop for a remortgage. They could be paying on a rate currently that might be less than the mortgage interest rate they were paying on previously, but it could be more than double what is available with a remortgage.

Savings could be found for a homeowner preparing for increasing rates, and along with the savings they could achieve peace of mind when the warnings of rate increases grow louder next year.