3 important mortgage admin tasks for the start of the new tax year

woman with calculator

The new tax year begins on 6 April, and with it comes a new opportunity to maximise your financial growth and wellbeing.

You could be looking at your property options for the year ahead, considering applying for a new mortgage, or perhaps searching for ways to reduce the price of your current mortgage repayments.

In March 2022, the Bank of England (BoE) raised the base rate to 0.75%, in an effort to curb the rising rate of inflation, which hit a historic high of 6.2% in the same month.

Both your future mortgage prospects and your current mortgage repayments can be affected by these rises.

So, read on to learn three mortgage tasks for the tax year ahead, so you can feel prepared for any further changes, and more easily meet your financial goals.

1. Start saving early if you are applying for a mortgage this year

Buying a home is an exciting milestone that you might have been looking forward to for a long time. However, in light of the rising cost of living, you could feel concerned about affording a new mortgage this year.

In addition to the general cost of living increase, according to The Scotsman, house prices in Scotland rose by 11.2% in the year to December 2021.

So, you may need a bigger deposit than if you had bought a home last year. You could also need to continue saving for a little longer than you had planned, in order to secure the mortgage you want on your dream home.

What’s more, mortgage affordability checks are becoming tighter, in order to reflect the rising cost of living, according to an iNews report.

All this means that if you plan to take out a mortgage this year, it may be wise to maximise your savings at the beginning of the tax year.

For example, if you are buying your first home, your Lifetime ISA (LISA) allowance of £4,000 resets at the beginning of the new tax year, and all your contributions will receive a 25% top-up from the government.

In light of rising house prices, it could be wise to maximise your LISA contributions sooner rather than later. This way, you could begin to benefit from tax-efficient growth as early as possible, to help you save the deposit you need to apply for a mortgage in 2022.

2. Consider switching to a fixed-rate mortgage

If you already have a mortgage, it may be wise to consider how switching your deal could help make your repayments more reliable.

Tracker- and variable-rate mortgage borrowers could well see higher repayments in 2022, as interest rates continue to climb.

So, switching to a fixed-rate mortgage could help you secure steady repayments in the coming years, which could give you the peace of mind you need in a time of economic volatility.

3. Consult a professional for mortgage guidance during this time of uncertainty

No matter where you are in your journey as a homeowner, consulting a mortgage expert can be a huge help in a time of uncertainty.

We can help you consider your options when it comes to switching your mortgage. Or, if you want to buy a home this year, you don’t have to shoulder the responsibility alone – we can provide invaluable guidance, and help take the stress out of securing your dream home.

Get in touch

If you wish to speak with a seasoned expert about your current or future mortgage as the new tax year begins, get in touch today.

Email [email protected] or call 0131 339 2281 to speak to us.

Please note

Your home may be repossessed if you do not keep up repayments on a mortgage or other loans secured on it.

Buy-to-let (pure) and commercial mortgages are not regulated by the FCA.

Think carefully before securing other debts against your home.

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