It seems that as a consequence of Brexit, rates will remain low in the UK for some time. In fact, the Bank of England have suggested that rates may have to fall further before the end of the year, which will have a knock-on effect on the pound and increase our cost of living significantly.
This time last year, rates were forecast to rise between 3-4% by the end of 2018 – but how things have changed since then. So, what does this mean for those looking to raise mortgage finance? Should you approach a mortgage differently given the increase in monthly expenditure likely to be experienced by many households?
The answer can lie in whether you opt for a Tracker or a Fixed mortgage. There are some great short term tracker mortgage deals around that can offer you a slightly cheaper rate than a fixed. It comes down to personal preference ultimately, but there are some very attractive rates on the market at the moment that offer great value for money. A 2 year tracker mortgage up to 75% loan to value is currently 1.29%. The equivalent 2 year fixed mortgage would be a fraction more at 1.39%.
If you are looking for longer-term security over short-term savings, they you should consider locking yourself into a 5 year or 10 year mortgage deal. Again, using a 75% loan to value, you could expect to get a 5 year fixed mortgage deal for 2.19% and a 10 year fixed at 2.69%.
Most importantly, don’t forget that depending on the lender, these mortgages can come with large exit clauses. This is well worth bearing in mind if you find yourself in a position where you can afford to repay a large proportion of your mortgage off early. If you are unlikely to want to do this, then now is a great time to secure yourself into a really great rate.
If you are looking to see how much you can afford to borrow, or whether you are eligible for a mortgage if you’ve recently become a locum, joined a practise or just changed your rota – then give one of our experienced medical mortgage advisers a call on 01656 332 600. We only deal with doctors mortgages and have been doing so for more than a decade. We know exactly which lenders favour locums, junior doctors, GPs and consultants with variable private income.