The advice comes following the news that rates are on the rise for average fixed rate deals. Last month Moneyfacts.co.uk revealed that rates on fixes had risen by up to 0.2% over the last month.
Email believes significant numbers of current borrowers will benefit over a three or five-year term if they opt to fix their mortgage payments now. The online adviser has also stressed that the rates currently on offer will not be available when Bank Base Rate (BBR) starts to make its inevitably move upwards.
In a rising BBR environment Email believes many borrowers will be looking for fixed-rate stability rather than tracker products. With this being the case, the longer borrowers wait to fix, the more they are likely to pay over the term of their deal.
Michael White, Chief Executive at Email Mortgages, commented: “We can appreciate that some borrowers will feel pleased with their current mortgage arrangement particularly if they are on an SVR of between 2.5 to 3.5%. The question, ‘Why should I fix when it will mean increasing my monthly repayments?’ is often raised. We understand and sympathise that borrowers will want to pay as little as possible on a monthly basis. However, what might seem a ‘no brainer’ at present needs to be looked at in closer detail, preferably with a mortgage adviser. All this market needs is for Bank Base Rate to begin inching up and lenders to act accordingly before any short-term gain turns to long-term pain. As can be seen by the latest Moneyfacts research, the rates for fixed-rate products are already on the rise and any movement in BBR will see this escalate greatly. When this does happen, borrowers will find that the attractive long-term fixed rates available now will no longer be an option.
“Those who are contemplating remortgaging to a fixed rate should certainly consider their options right now rather than waiting. To hang on, even for a couple of months, could mean a further 30 to 40 basis points rise in pricing which over the course of the mortgage will add a significant amount to the overall payment. Email Mortgages is fully aware that many borrowers will be feeling the benefits of significantly reduced payments at present, however, a mortgage is a long-term commitment and everyone should consider their repayments over a period much greater than the next few months. As a mortgage adviser, Email Mortgages, is in a position to run the calculations for borrowers to ensure they have the most suitable and competitive product for their needs not just in the rest of 2009, but for the full duration of their mortgage term.”
