27 May 2021

Remortgage rates below 1% are now available

Remortgage rates below 1% are now available

If you are looking to remortgage your home, then you will be delighted to learn that a below-1% rate is available.

Two mortgage lenders now have two-year deals for property owners.

TSB is offering a 0.99% fix, which equates to a 3.2% annual percentage rate of charge. The deal is available at a 60% loan-to-value, and there is a £1,495 product-fee charge.

Meanwhile, Hinckley & Rugby Building Society has a 0.99% discounted variable rate, which equates to a 4.5% annual percentage rate of charge. It is available at a 65% loan-to-value and requires a minimum loan of £100,000. There is also a £699 product-fee charge.

Moneyfacts points out that choosing a mortgage offering a 0.99% rate can significantly reduce mortgage repayments, sometimes by many hundreds of pounds.

It adds: "Homeowners coming to the end of their mortgage deal or who are already on their lender's standard variable rate should consider remortgaging to see if it will lower their monthly repayments."

It emerged earlier this year that, almost 90% of homeowners haven't thought about remortgaging, despite the big savings they could make.

Britons could be more than £2,000 better off this year by switching to a fixed-rate product, according to new research from the TSB.

This is an average monthly saving of £169 by moving from a standard variable rate, but 89% of property owners haven't considered this as an option.

The TSB study also found that, for 84% of people, their mortgage is their biggest monthly outgoing - yet 29% aren't aware of how much they pay in interest each month.

But even though remortgaging at a time when rates are competitively low may help to reduce monthly repayments, there are times when it is not the right option.

For example, homeowners who are currently in the middle of a mortgage deal may find that the cost of exiting this agreement early counteracts any savings that can be made from remortgaging at a lower rate.

Other homeowners planning to move house within the next year also have to be careful about signing up to a remortgage just now as it could result in them being locked into a deal that cannot be transferred to the new property and that will be costly to exit early.

Talk to our experts

Due to remortgage soon? Talk to our expert advisers about how we can help you find the best deal.

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