March 19, 2010
Cheap Mortgage Rates Can Hide Nasties – Get Broker Help
You may be enticed into taking out a mortgage with a great headline rate – but do you know what else is included in the mortgage?
Many people just look for the headline rate and think that is all that have to consider. But there is much, much more to a modern mortgage than the initial rate – there are fees and charges, penalties and caveats, limits and small print and terms and conditions that will make your head spin.
In particular, Moneysupermarket.com has warned that many low rate mortgages come with very uncompetitive standard variable rates that they will resort to after their discount period.
Hannah-Mercedes Skenfield, mortgages channel manager at moneysupermarket.com, says: "It is worth being aware that, as a discount product some mortgages are vulnerable to changes in the lender's SVR offering. We are currently seeing a lot of discrepancy between lenders' SVR deals with a difference of 3.95% between the lowest SVR rate and the highest."
So the only way to be sure about your long-term validity of mortgage is to ask an expert. If it looks like a great rate, ask an expert what is under the bonnet of the loan. And if it looks too good to be true then it probably is – so be sure of what you are getting into by going through a professional mortgage broker.
SOURCE: Moneysupermakret, 11/03/10
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