With interest rates rapidly rising, what do experts say about coping with costs?
Headlines about interest rates are grim for mortgage customers, and 1.6 million UK homeowners with a fixed rate will see their deal come to an end by December 2024, according to UK Finance.
"Most lenders will allow up to 10% overpayments per annum, but make sure you keep some cash as a rainy day fund as it won't be easily accessible once used to reduce the mortgage," says David Hollingworth from mortgage brokers London & Country. "However, it's best to use this as a short-term solution, otherwise you will have to pay your remaining mortgage balance at the end of your mortgage term," he adds.Image source,This is possibly not a realistic option for a growing family, or for the owners of a small flat.
"Consumers looking to re-mortgage may find it difficult to afford higher interest rates, so seeking independent advice is essential to consider every option available to them, such as downsizing," says Rachel Springall from financial data firm Moneyfacts.The typical mortgage term is 25 years, but 30 and even 40-year terms are now available.
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