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Martin Lewis’ Money Saving Expert team has warned about a key change affecting Halifax and Lloyds mortgage borrowers.
The group has warned customers that the two banks are changing their policy so you can only lock in a new rate up to four months ahead of when your current deal ends, rather than up to six months.
Mortgage rates have been declining recently as the Bank of England has finally cut the base interest rate, which is currently at five percent.
Those looking for two- and five-year fixed rate deals can get rates starting from 4.25 percent and 3.88 percent respectively, according to the moneyfactscompare.co.uk website at the time of writing.
The policy change follows Nationwide and Santander likewise reducing the transfer window down to just four months.
Some lenders still allow customers a six-month window, including Barclays, HSBC, NatWest and Virgin Money.
The Money Saving Expert team urged people approaching the end of their mortgage deal to check how far in advance they can secure a new rate.
This principle applies whether or not you are planning to stick with your current provider.
Other factors to consider when you consider looking in a new deal include:
- Are there upfront fees you need to pay to secure the rate?
- Is there a limit to when you can leave the rate? Most lenders won’t allow you to turn down a deal 14 days or less before the new rate starts
- Are you set to start two mortgages at the same time? This can happen if you lock in a rate and then go for another one, but you forget to cancel the original one. You may need to pay an early repayment charge of £1,000s if you cancel late
HSBC has today (September 3) cut its rates with the bank now offering deals starting at 3.84 percent.
A HSBC spokesperson said: “We’re frequently reviewing our mortgage rates and aim to remain as competitive in the market as possible. We’re really pleased we can offer even more customers rates that have dipped below four percent – some of our lowest rates since the start of the year.
“Our lowest product is still our 60 percent LTV five-year residential mortgage, which is offered at 3.84 percent, but we’re pleased to also now be offering 3.99 percent on our 70 percent and 75 percent LTV five-year residential mortgage ranges.
“We’ve also made further reductions in the higher LTV ranges offering 4.29 percent on our 80 percent LTV five-year residential mortgage, to further support those customers with smaller deposits and helping to make homeownership more accessible across a broader range of lending tiers.”