An average homeowner on a Standard Variable Rate (SVR) could save more than £ 5,000 in payments by switching to a new two-year fix, Experian’s analysis shows.
The calculation assumes a mortgage of £ 150,000 over 20 years on an SVR of 4.49%, with a monthly repayment of just under £ 950.
With a new two-year fix to 1.11%, and assuming an arrangement fee of £ 999, the borrower is saving over £ 5,000 over that two-year period.
Experian adds that nearly 6% of all homeowners will reach the end of their term within the next three months.
“With an interest rate hike looming, it would be worth exploring your options now and getting a new rate locked in,” said James Jones, chief consumer officer at Experian.
He adds, “With Christmas just around the corner, it’s that time of year when many of us are looking for ways to grow our money – but many overlook opportunities to lower the cost of existing borrowing.” .
“Homeowners may be able to realize substantial savings by switching to a new fixed rate mortgage deal, so we urge anyone with a soon-to-end solution to consider their options.
And L&C Mortgages Associate Director of Communications David Hollingworth comments: “There are still competitive offers in the market, but if the wait for an interest rate hike persists, the currently available offers may not last. too long.
“Use a mortgage comparison to see if you’re on the cheapest deal or if you can save money by using another company’s offer.
“When thinking about the change, don’t forget to factor in all other costs and check if there are any early exit fees associated with your current deal. However, shopping around could help save thousands of pounds over a short period of time. “