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If your mortgage is coming up for renewal, don’t miss out on these top tips for getting the most from it:
- Research rates
Conduct thorough research into current market interest rates to help you determine whether you could save money buy getting a loan from an alternative lender. The most efficient way of doing this is to work with a Polar Mortgages SW15 2PG 2021 broker.
- Take heed that the rate posted is not usually the lowest
All lenders are open to negotiation, so don’t be afraid to barter with their posted rates. Again, a broker will do this on your behalf.
- A posted rate may be low, but that doesn’t necessarily make it the best rate
A low price isn’t an automatic indication that the rate is better for you, and may come with associated penalties. Check the fine print and work with a broker to help ensure that you get the best deal for your circumstances.
- If you’re offered a lower rate, keep your payments the same
Lower monthly payments may increase your cash flow a little, but by keeping the same monthly payments at your renewed lower rate of interest, you would be reducing the overall amortization and be able to pay your mortgage off quicker.
- Contribute more to your lump sum payment
With no pre-payment limits, renewal is the ideal time to make a lump sum payment on your mortgage and save in total interest costs, not to mention making a significant dent in your amortization.
- Fund projects by leveraging your home equity
If you don’t have money spare to make an extra lump sum payment toward your principal, you could leverage your home equity to help fund projects or other needs. If you’re renewing and you need to fund something significant, this is a great time to refinance and take equity out.
- Go for broke!
Mortgage brokers can help make the entire mortgage application process much smoother while helping you to save money with deals from a variety of lenders, some of which are only made available to brokers. If you’re not already working with one, consider consulting with one to see what savings you could make, while lowering your stress levels.
- Make the switch to another lender
While your existing lender may tell you that there is a significant fee applicable should you choose to switch financial institutions, most will simply absorb the discharge penalty into the new mortgage; so, it could still be worthwhile.
- Don’t renew at the eleventh hour
You want to put yourself in the best possible position when it comes to meeting with your current lender to make a renewal decision, so it pays to be as prepared as possible. The best way to ensure this is by beginning the process around 4 months (120 days) before your renewal due date.
Ultimately, working with a mortgage specialist means that you barely even have to think about the above 9 tips, let alone stress over them, since they will take care of the whole process for you, and work hard to get you the best rates, from the best lenders.
