How to Lower Your Mortgage Repayments

When you’re looking to lower your mortgage repayments it can often feel as though there are either too few options – or too many. This is frequently down to homeowners trying to Google their way to the right solution rather than speaking to an expert.

But mortgages are complex financial products and choosing the wrong option can be costly. So, it makes sense to speak to a broker first – especially if there’s a chance of a free no-obligation chat.

How can you lower your mortgage payments?

There is no substitute for speaking to a broker when looking to reduce your monthly repayments. Weighing up the advantages and disadvantages of each alternative requires an expert. A broker will help you accurately calculate the overall cost of borrowing as well as the immediate impact on your monthly outgoings.

Options include:

• Remortgaging onto a lower rate: This could be with your existing lender or by switching to a new one. If your current loan is up to date and you still match your lenders’ criteria, they might offer you another deal. But you could find switching providers lowers your payments even more. So, you should always speak to an experienced remortgage broker to ensure you get the best deal on the market according to your circumstances.
• Term extension: Paying your loan over a longer period will reduce your monthly repayments in the short term but increase the amount you pay overall. Sometimes, this is the best course of action. But to avoid increasing the amount you pay unnecessarily,  find a broker who understands your situation and will check what other deals are available to you first.
• Switch to interest-only: Again, this is usually a short-term fix and should not be taken lightly. It will reduce your monthly mortgage repayments but typically results in other additional monthly costs to cover clearing the balance at the end of your mortgage term. It’s paramount that you make a clear long-term plan before switching to interest-only. And it’s never a decision you should take without consulting a professional.
• Pay off a lump sum: If you have significant savings or have recently received a lump sum, this may be your best option. Remember, though, that once you’ve paid that lump sum off, what was once liquid cash is then tied up in your property. You also need to make sure you don’t overpay too much and incur a penalty from your lender.

How a mortgage broker can help you lower your payments

First and foremost, a mortgage broker will narrow down your options. This will make your decision more manageable.

Often, there is no definitive answer as to which is the best way to reduce your monthly payments. But with the help of a broker, you can be sure the one you choose is right for you.

We work with brokers who have whole of market access and can present you with a selection of deals that meet your short and long-term goals. They’ll clearly explain the advantages and disadvantages of each to help you make the best and most cost-effective decision.

Get in touch today to speak to an expert and make a start on reducing your mortgage payments.

Ways to lower your payments without refinancing

If you can’t (or don’t want to) refinance to reduce your mortgage repayments, don’t worry.

There are other options available to you, including:

• Switching to a different type of mortgage
• Payment holidays
• Changing mortgage insurance
• Taking in a lodger

More details on how to lower your mortgage payments without refinancing can be found in our blog.

Lowering your payments if you have bad credit

Whether your credit issues occurred before or since you took out your current mortgage, there may be several options open to you here:

• Remortgaging remains a possibility but may require a specialist bad credit lender.
• You could look to extend your term with your current provider or switch to a longer term loan with a specialist provider.
• Interest-only may be an option but shouldn’t be done without first speaking to an expert.  This route will result in you having to make plans to clear the outstanding mortgage balance at the end of your term.

A chat with one of the bad credit brokers we work with is completely free and can help relieve the stress of going it alone.