An interview with Trevor

We sat down with one of our mortgage experts, Trevor to pick his brain on the mortgage market.

Trevor has been a mortgage adviser for over four years and has processed over £10 million worth of mortgages, so he knows a thing or two about getting the right mortgage.

What are the most common questions you get asked as a mortgage adviser?

Right now, understandably, the most common question I’m getting asked is if interest rates will drop soon.

Other common questions that I frequently get asked are “can I still switch to a lower rate if I secure a product now?” and “why do lenders have product fees?”

My answers to these questions are, if I knew the definite outcome of the interest rate drops in the future, I would be a billionaire! However, all predictors and experts in the market are indicating a potential drop in interest rates over the next 12 months.

Yes, you can switch to a lower rate after securing a product. Most lenders will allow you to switch to a lower rate as long as you are 14 days out from your current product expiring.

Product fees are in place to accommodate for the loss in interest the lender will derive by providing a lower interest rate - these products are beneficial particularly for people with sizeable mortgages over £300K.

Has rising rates over the last 18 months changed the way people remortgage?

Yes, people tend to be moving to a 2-year fixed rate, in hope that the rates will drop soon, or are holding off until later in the year to see if the market improves post-elections.

What current trends are you seeing in the mortgage market?

People are looking at shorter fixed terms to see if the market improves instead of locking in on a 5-year rate and being stuck on it if the rates do come down.

Right now, are more people sticking with their lender or moving to a new lender?

There hasn’t been much of a change in this. If their mortgage is over £250K, most people are open to looking at a new lender if the rates are more favourable. But for smaller mortgages, it’s more common for people to stay with the current lender.

What are the most important things people should know before remortgaging?

The most important thing people should keep in mind, is to not get lured by lower rates with higher product fees if fixing in for a shorter term (i.e. 1 or 2 years) as this will be an extra cost and unlikely to recuperate during the fixed period unless the mortgage is very large.

What’s your top tip to someone about to remortgage?

Always speak to an adviser as products are not always clear-cut and obvious. There is a lot of misinformation in the media, so it’s really important to speak to an adviser to make sure you’re getting the right information.

How long does a usual remortgage take? Is it quicker with Sprive?

A product transfer (moving to another deal with the same lender) is almost instantaneous and usually has the offer produced within 48 hours. A full remortgage to a new lender will usually need, at the very least, one month for the whole process to complete.

What would you say to someone who is considering making mortgage overpayments?

Ensure you understand the lender’s restrictions on your overpayment allowance, and use the Sprive app to maximise this facility!