How will Brexit affect my mortgage

The referendum vote for Britain to leave the EU has thrown up some big questions for the country’s households. Here’s what our content producer Rachel Allen has to say.

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The short answer is – no-one knows for sure. But one of three things could happen.

The Bank of England might decide to raise interest rates, or cut them. Or, they could stay the same.

At the moment, the base rate is 0.5% – which is historically low.

If interest rates are cut, this would make borrowing cheaper. So, if you’re on a variable rate mortgage, your monthly payments could go down.

But, if the Bank increases interest rates, it’s almost certain that mortgage rates would go up, for those not on fixed rate deals.

If you’re on a variable rate mortgage and you’re worried about rates rising, you could remortgage onto a fixed rate deal now, and lock in your costs for between 2 and 5 years.

This would give you certainty. But if rates did fall, you wouldn’t see the benefit.

If you’re already on a fixed rate deal, you should probably stay put. But you’ll need to think about what to do when your deal comes to an end.

Whatever you decide to do, it’s important to weigh up the pros and cons. Take into consideration any exit fees you might be charged if you move your mortgage before the end of your deal.

You can get free mortgage advice from London & Country. They’re a broker who search the whole of market, and they won’t charge you a fee.

If there was ever a time to make sure you’ve got the best possible deal - it’s now.

 

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