Once you’ve got your mortgage, you might assume that your relationship with your mortgage broker comes to an end.
In fact, your mortgage broker can provide ongoing support in the years and decades that follow. By getting in touch with your mortgage broker, you could save yourself thousands of pounds and protect your loved ones from unexpected events.
Here are three reasons why you should contact your mortgage broker today.
1. You could switch to a better deal
When your fixed-rate deal comes to an end, your lender will probably move you onto their Standard Variable Rate (SVR). This is likely to be much more expensive than your current deal.
According to the latest Moneyfacts data, the average SVR is 4.44%, whereas the average rate on a fixed-rate deal without a product fee is 2.8%. If you have a £150,000 mortgage balance with 25 years remaining, you could save around £132 per month, or £1,584 a year, by switching to a new fixed-rate deal.
Even if your lender contacts you with a new deal, it won’t necessarily be the cheapest deal available or the right one for you. Mortgages are very large, so reducing your interest rate by just 0.5% could make a big difference to how much you pay overall.
Mortgage brokers usually have access to a much wider range of products than you can find yourself on comparison sites. They’ll be able to advise you on the right deal for your needs and circumstances. They’ll also check if your loan-to-value has reduced, which might enable you to access better rates.
2. You could make overpayments
If you’ve saved up extra money since you took out your mortgage, you could use it to make overpayments. This could shorten your mortgage term and reduce how much you pay in interest.
Most lenders let you overpay 10% of your remaining mortgage balance each year without charging a fee, although the terms vary from one lender to another. If you go beyond this limit, you might have to pay an Early Repayment Charge, which typically ranges from 1% to 5% of the amount overpaid.
A mortgage broker can help you decide whether to make overpayments. They’ll explain how much you could save in interest, the specific terms and conditions of your deal, and whether an overpayment is right for you in the context of your wider financial circumstances.
3. You might be missing out on a vital financial safety-net
Mortgage brokers don’t just advise on mortgages. Most brokers also provide advice on protection, which offers a vital financial safety-net if you die or become ill.
Life insurance can protect your loved ones from financial hardship if you die unexpectedly. Without this safety-net, your family could struggle to pay the bills and may even resort to selling their home.
Critical Illness Cover pays out a lump sum if you’re diagnosed with a specified serious illness. This could help you pay off your mortgage or adjust your home to make it easier to live with your condition.
Income Protection provides a monthly payout if you’re too ill or injured to work and lose your income. It provides peace of mind that you’ll still be able to cover your day-to-day living expenses.
Whether you’ve just taken out a mortgage or have had one for several years, a mortgage broker can ensure you have the protection in place.
Get in touch
At Edinburgh Mortgage Advice, we provide impartial advice and an ongoing service to all our clients.
We’ll ask if we can recontact when your new rate is finishing to make sure you have the right deal going forwards. We’ll also advise you on what protection you may need to ensure you can deal with whatever comes your way.
For more information, please email [email protected] or call 0131 339 2281.
Your home may be repossessed if you do not keep up repayments on a mortgage or other loans secured on it.