Following concerns over the property market as a result of the EU referendum result, the YEP asked mortgage adviser Franz Muehlthaler whether now is a good time to review your mortgage:
The recent vote to leave the EU has understandably sparked much discussion and concern over what will happen to house prices and the cost of mortgages in the UK. There has been a lot of speculation over whether house prices will fall and which way interest rates could go.
In times like these it’s important to remain calm, consider your options and avoid making any decisions in haste. Many of you wanting to move house may be tempted to sit tight for now and wait and see what happens as political leaders are still in the midst of creating contingency plans. However, it is important to remember that the main reasons you wanted to move house still remain the same, regardless of the new and unknown territory we are in, and these are the things that will continue to drive the property market.
Houses will still become available, families will still grow, people will still want to get on the property ladder, and people will still want to downsize. So although people’s sentiments may have changed, ultimately there is still a supply and demand apparent in the market. With no announcements yet as to what will happen to interest rates, all we can do is prepare ourselves for what might happen. Now could be as good a time as any to revisit your financial position – even during times of stability, it is always advisable to review your finances every once in a while. A mortgage is probably the biggest financial commitment you will ever have in your lifetime, so, although it isn’t a nice subject to talk about, it’s advisable that you prepare yourself for all eventualities and protect your home, and your family, with life insurance. You might also want to review what protection you have should your circumstances change. Look into taking out protection to give yourself financial security and peace of mind. Reviewing your mortgage annually will give you a head start on any deals that are to be had, so it’s always worthwhile keeping an eye on whatever offers are circling the market.
What we do know right now is that banks and building societies are still in the business of lending and there are some very good deals on the market at the moment. There is still a plethora of mortgage deal options available. Like many others, you will no doubt be working hard to pay off your mortgage as soon as possible and there’s no reason why that still can’t be your top priority. Regardless of the referendum results, none of us are able to predict the future so being prepared for all eventualities and weighing up the options is always an advisable move. If you are worried about how interest rates could affect you, then consult an independent mortgage adviser.
By Franz Muehlthaler, Holroyd Miller Properties in association with Reach 4 Mortgage Solutions and the Mortgage Advice Bureau.