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Mortgage rates are falling – yes really!

Mortgage rates are falling – yes really!

Date: 6 January 2023 | By: cosgrove

There's been a lot of turbulence in the mortgage market but what remortgage customers, first-time buyers and home movers should know is that mortgage rates are falling - yes really!

Prior to the Truss mini budget rates had been gradually rising due to high inflation,  but the shock waves of the so-called fiscal plan sent costs soaring. Most experts now expect to see average mortgage rates settle at between 4 and 5 per cent this year. This is based on an assumption that inflation has peaked and the Bank of England will slow base rate rises. Add to this a slowing housing market and lenders may start to offer competitive mortgages to attract customers

Stick or twist?

Should you put off moving home? With fixed rate mortgages slowly decreasing in cost, those who are thinking of moving or buying or who need to remortgage may be tempted to leave it for as long as possible to potentially take advantage of lower rates. In uncertain times it pays to get expert advice as mortgage rates are falling - yes really! A good broker can look across the complex and often confusing mortgage market and find the best deal for your personal circumstances. This may mean going to smaller, niche players, not on the high street and it always means reading the small print and not everyone has time to do that!

Advice is key as an increasing number of borrowers may not fit the lending criteria of the high street banks, especially if you are a first time buyer dealing with moving deposit goal posts. It may also be worth exploring more flexible options to take advantage of lower rates. If you have a fixed rate deal ending within the next six to nine months, you need to try to avoid going to a standard Variable Rate (SVR) so you should look into how much it would cost to remortgage now – rather than waiting - and consider locking into a new deal. Some lenders will agree a new rate months before yours is due to expire, even up to six months in advance.

What if I am buying a home? 

Those with home purchases agreed should also aim to secure rates as soon as possible, so they know exactly what their monthly payments will be. First time buyers have had it tough but there are a growing number of mortgage products available and having a clear understanding of your options as well as your likely borrowing capacity will put you in a strong position to make secure your property.

 How to compare mortgage costs 

Trying to go it alone is confusing and time consuming. The best way to compare mortgage costs and find the right deal for you is to speak to a good broker. Rates can change quickly, overnight even, so don’t delay. Our specialist five strong expert mortgage team are ready to help.


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