As part of the DIY Nous method for saving money on household utilities, this is a step-by-step approach after you have named your mortgage provider and double-checked the terms of your contract with them.
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Unless you’ve recently had a windfall, you probably can’t suddenly do without your mortgage. However, it is crucial that you keep track of when your fixed term ends, because when it does most providers move you automatically to a variable rate, which can be very expensive.
The amount you pay each month is based on the rate your provider gives you and the length of the mortgage term. You may be able to reduce your monthly payments by extending the term, this will however mean you’re paying your mortgage for longer so will cost more over time. You may also be in a position to change your loan-to-value ratio (LTV), where more equity in the property or a greater deposit means your rate could be lower.
<aside> ℹ️ See our Mortgages page for more info.
Make a note six months before the end of your current deal to allow time to shop around and make the switch. You will need to provide ID, Bank Statements and proof of income so it’s sensible to line these up in advance. You will also need the current balance on your existing mortgage and the exact date it ends.
Some providers allow existing customers to remortgage online, but the rates they offer you can vary enormously. If you’re lucky enough to be offered a deal you’re happy with, remortgaging this way can be relatively painless. However, you should consider independent advice, as your provider will only advise on products they sell, and you might find a cheaper option by shopping around.
A new mortgage will typically have an arrangement fee and legal fees added to it, and these should be clearly communicated to you. They can be paid upfront, or added to your mortgage, in which case they would incur interest which would cost you more in the long run.
The rising cost of living has already affected millions of households and if you’re struggling to pay essential bills, you’re not alone.
Some households may need urgent or more specialist help than we can provide. If you’re unable to pay a bill, the first step is to contact your provider and tell them. They are best placed to make sure you are receiving any financial assistance you may be entitled to.
<aside> 🆘 See the list of specialists at Cost-of-living resources
Last updated: April 2022
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