Darren Pescod, CEO of Theasktheexpertdarren Mortgage Broker LTD, offers his advice on a number of common questions and situations his clients face.

Q: ”I am currently in a fixed rate mortgage, is it worth swapping mortgage deals as the rates are much lower at present?”

A: Hi, this all depends on how much of a saving can be made on the new mortgage deal, versus (1) the penalty you would have to pay to exit your current mortgage deal and (2) the costs involved in securing the new, lower mortgage rate.

In my experience, the savings that can be made rarely outweigh the penalties you have to pay. The good news is that it is a very quick exercise to check and to give you peace of mind. A good mortgage broker can have this checked for you within 5 minutes (at no cost) and all you need to know is how much your redemption penalty is and when the fixed rate period ends.

There are some exceptional circumstances when clients swap into the lower rate, regardless of whether this is financially beneficial for them. This is very rare and is only ever done / considered when a client is desperate for an immediate monthly saving. I would advise anyone to avoid this scenario where possible. On a final note, these new and lower mortgage deals can be secured up to 6 months in advance of when your current mortgage deal expires, so it is always worth an exploratory chat.

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