Gary Oxborough is Practice Principal here at Barlow Irvin Financial Services. This month, Gary talks about the recent talk in the press about interest rates and how it will affect mortgages.
There is a lot of talk in the press recently about interest rates increasing. Some of the headlines I’ve seen are quite disturbing and to be honest – seem designed to create news, rather than report it.
As you may have seen, the Bank of England has kept the base rate at 0.1% again this month, despite many people expecting them to announce an increase. I have worked in the mortgage industry for over 17 years and for the vast majority of that time, interest rates have been moving downwards to where they are now, at an all-time low. Sooner or later, this trend has to reverse, and rates would need to increase again.
However, I feel that any increase in the near future will be gradual and taken in small steps as our economy is still quite fragile and any major changes would be too risky. While it may be prudent to look at taking one of these historically low fixed rates now, I really believe there is no need to panic. I truly believe that when looking at a mortgage, the interest rate you get should be secondary in importance to how the mortgage fits your personal circumstances and plans for the future.
Of course, it is important to get the best deal possible, but if you panic and lock yourself into a longer-term fixed rate that isn’t appropriate for your future plans, such as moving home or paying down your mortgage quickly by over-payments, then it will cost more in the long run. As always, this is why it is vital you take professional advice when reviewing your mortgage to make sure you take the most appropriate mortgage for you, not just because the press has created a panic.
My team, as always, are on hand to listen and offer any advice required and don’t hesitate to get in touch.