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Borrowers pay up to £6,500 by sitting on default mortgage rate

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Written by: Lana Clements
10/07/2018
Borrowers on a Standard Variable Rate (SVR) mortgage could save up to £6,530 by remortgaging to a new deal, research suggests.

Homeowners who remortgage from a lender’s SVR to a fixed product could save £4,509 over two years and £6,530 over a three-year period, according to findings from the Legal and General Mortgage Club.

It comes ahead of a potential rate hike by the Bank of England, with expectations policymakers could make a move in August.

Now’s the time to make the most of low mortgage rates, Legal & General Mortgage Club said.

Borrowers coming to the end of their existing terms or already on an SVR could end up saving more than £2,000 a year on their monthly mortgage repayments.

Kevin Roberts, director at Legal & General Mortgage Club, said: “With rates still close to their historic lows and unlikely to improve further, now is a great time for borrowers to secure a fixed rate deal on their mortgage.

“Borrowers who are on an SVR or coming to the end of their term have the potential to save themselves thousands of pounds on their mortgage, which could easily pay for home improvements or that much longed-for family holiday.

“These near all-time low rates will not last forever, so any borrowers who are looking to secure a good deal should speak with a mortgage broker now.”

Related: See YourMoney.com’s How to remortgage guide for more information.

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