Mortgages Short Term Memory

Mortgages Short Term Memory



Mortgages - Short Term Memory
Do you,​ in​ common with millions of​ other home owners,​ have a​ short-term mortgage? If so,​ it’s very easy to​ set up the​ monthly repayment and then get involved with so many other aspects of​ your life that time slips away and before you​ know it,​ the​ two or​ three year period of​ your loan is​ coming to​ an​ end .​
Whilst many lenders write to​ their customers towards the​ end of​ the​ loan period,​ it​ isn’t compulsory.
When you​ sign on​ the​ dotted line for your mortgage deal,​ you​ are issued with a​ key facts mortgage document which will include all the​ loan details together with the​ all important date that your fixed price deal will come to​ an​ end .​
If you​ forget this date and also fail to​ receive a​ reminder,​ the​ first thing you’ll become aware of​ it​ a​ notice of​ a​ change in​ monthly re-payments,​ which means that you’ll be going on​ to​ the​ lender’s usually expensive SVR,​ or​ standard variable rate.
As an​ example,​ on​ a​ loan of​ £150,​000,​ you​ could easily be paying out a​ substantially higher amount - more than £200 a​ month extra .​
This is​ assuming that the​ SVR is​ 2.25% more than the​ special rate,​ which would not be unusual.
Obviously most borrowers would opt to​ change to​ an​ alternative short term mortgage,​ but it​ takes between four to​ six weeks to​ arrange this change-over.
If you​ are extremely diligent at​ remembering to​ take action you​ may run into problems too as​ if​ you​ ask what your options are when there’s more than a​ month or​ so to​ run,​ your lender will very often say they’re unable to​ make a​ decision until nearer the​ date .​
Then you’ve been stalled and still can’t make a​ decision.
There has been some improvement in​ the​ way insurers are handling the​ situation .​
An increasing number of​ them are contacting borrowers around three months before the​ end of​ their current deal and setting out options.
It’s not always the​ right thing to​ automatically change to​ another lender to​ get the​ best price .​
Consider your options carefully .​
If you​ stay with your current lender,​ there will be a​ saving on​ legal charges and you​ shouldn’t need another valuation .​
Nor will exit fees be charges,​ which could mean a​ fairly big saving .​
It just could be that a​ slightly more expensive deal with your current lender may work out best in​ the​ long run.
Because of​ this and with the​ intense competition in​ the​ re-mortgaging business,​ it’s becoming increasing common to​ find new lenders who will fund the​ charges,​ just to​ get your business.
If you​ used a​ broker to​ arrange the​ mortgage,​ you​ may well find that they’ll send you​ a​ friendly reminder .​
This is​ a​ service which will be no problem for them and another thing less for you​ to​ think about,​ which has to​ be good news .​
Your broker will weigh up the​ deals and come up with some facts and figures when it​ comes to​ renewal too .​
The internet’s the​ place to​ look and an​ on-line broker’s the​ person to​ look for.
Don’t’ forget!




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