Many Homeowners Beat the Interest Rate Hike in November

Many Homeowners Beat the Interest Rate Hike in November

Homeowners have been able to take advantage of low interest rate offers from remortgage lenders and gain a variety of benefits. Some simply sought out a lower rate to save money. Other homeowners not only remortgaged to save money, but also secured a fixed rate deal to secure their low rate throughout the term of their deal rather than face rising rates. There were also some homeowners that turned their built up equity into cash along with their remortgage low interest rate deal.

In November, according the data from LMS, the number of remortgage completions rose by 15%. This increase could have been simply homeowners choosing to remortgage at the end of their expired mortgage term rather than allow their lender to move them to their standard variable rate (SVR). It could have also been homeowners that were on a SVR choosing peace of mind with a fixed rate remortgage rather than stick with their lender’s risky variable rate.

However, the strong demand from homeowners could be attributed to the warnings of possible interest rate increases due to rising inflation. 

Those that did choose to remortgage and completed in November turned out to have taken the best strategy. For in the start of December, the Bank of England’s Monetary Policy Committee (MPC) increased the standard base interest rate for the first time in three years from the historic low of 0.1% to 0.25%.

Lenders quickly pulled their lowest interest rate deals and issued new ones onto the lending market reflecting the move by the Bank to help fight rising inflation in the UK.

Though there are still very low rates available on the market, those that remortgaged before the increase occurred likely secured deals not seen today,

Having not remortgaged before the interest rate increase in December shouldn’t put off homeowners thinking they missed out. There are still low interest rate deals available from lenders and remortgage brokers. Shopping online could quickly offer quotes for homeowners to discover what deals are available and possible savings.

Remortgaging sooner rather than later could again be the best strategy as there are warnings for more interest rate hikes in the first quarter of the year. Waiting could have homeowners paying more than necessary when a lower rate could be secured with a remortgage before the MPC increases the base rate yet again. 

In February the next MPC meeting will occur, so there is still time for homeowners to take action and not miss out this time around.

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