Q&A: Moving your mortgage

Thousands of people switch mortgage provider each year, some to save money, others as a means to borrow more cash.

What factors should you bear in mind when switching mortgage providers.

Can remortgaging really save money?

It depends.

It is estimated that more than half of all borrowers are continuing to pay over the odds for their mortgage each month.

Usually these people are paying the lender's standard variable mortgage rate. There will be lower rates available from other providers.

But this is not the whole story.

In recent years, banks and building societies have been hiking mortgage fees to subsidise attractive headline interest rates.

So called mortgage arrangement fees have sky-rocketed as have charges for redeeming a mortgage.

As a result, you have to do the sums to make sure that what you gain through switching provider - a lower rate of interest - is not lost through higher charges.

That sounds very complex, what help is available?

There are financial professionals who can advise you. Some of these are employed by lenders and may only be able to recommend the products of one mortgage provider or a small panel of providers.

A financial adviser may not be the best route to a future mortgage deal.

But there are a host of independent mortgage brokers who are free to advise you from the whole of the mortgage market.

However, be aware that they may take commission from the provider they recommend to you.

You may also have to pay a fee for independent mortgage advice.

It is also wise to do your own research to compare the rates that a lender or broker is offering you.


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