The financial guru has warned that 1.8 million homeowners with fixed-rate mortgages ending this year could see payments increase
A financial expert has cautioned that failing to take action could see your mortgage payments surge by “£300 a month”. Nearly two million Brits face the prospect of substantially increased payments.
In an update on his Money Saving Expert (MSE) website, Martin Lewis provided crucial guidance regarding mortgages. This formed part of a broader overview on achieving savings during February. Martin said: “January has folded itself up, put on a coat and slipped out the back door. It’s the month most people intend to organise their finances, but intention isn’t action, so if you never quite got there… this is your belt-and-braces, no excuses, bill-busting sweep-up.
“We started this last week with the Big Energy Switch (still on till Thursday). Yet remember, the easiest way to overpay a bill is to assume you’ve sorted it… when you haven’t, so no apologies that I’ve already covered some of these this year – what matters is if you’ve checked them.”
Delving into the specifics of reducing mortgage costs, he estimated that a “typical” saving could reach £2,000 per £100,000 of the mortgage. Martin also highlighted that this process could take as little as one hour to complete.
According to Martin, approximately 1.8 million fixed-rate mortgages are set to expire this year. If you “do nothing” about this, you risk being transferred to a significantly higher interest rate of around seven per cent.
He stated: “Over 1.8 million mortgage fixes end this year. If that’s you and you do nothing, you could see what you pay increase by say £300 a month as you’ll be moved to your lender’s Standard Variable Rate (typically seven per cent compared to the four per cent cheap fixes).”
Here’s a step-by-step guide to assist you:.
- Check your current mortgage details
- Do a quick mortgage best-buys comparison to see what’s available
- If it’s looking good or you need help, speak to a mortgage broker
Martin added: “So prepare in advance to stop that happening. This takes time, but an hour should be more than enough for you to work out if you’re going to be able to save large.
“Our free remortgage guide can take you through it step by step and our ultimate mortgage calculator will help you see if you can save.” On a separate page providing re-mortgaging advice, Martin continued: “Remortgaging can help you save £100s or even £1,000s.
“But if you want to change mortgage deal then getting it right is really important, otherwise you might not actually end up saving.”
You can use the free MSE mortgage calculator here.
