New Year resolutions for mortgage borrowers

By Lauren Burns

Over half of adults in Northern Ireland and the rest of the UK are expected to make a New Year resolution, and while the usual targets in respect of diet and fitness top the lists, getting finances in order is now regularly one of the most common goals set for the New Year.

Mortgage borrowers in particular might want to consider a couple of resolutions that could reduce their monthly mortgage payment, or reduce the term of their mortgage debt considerably. An interest rate increase is expected in the second or third quarter of the year, and while the first rise is expected to be fairly low, mortgage borrowers should act to take advantage of the current low rate.

One option for home owners is to resolve to overpay their mortgage each month in order to increase their equity share in the property quicker. Property owners could look at what their monthly mortgage payment would be if interest rates go up by a quarter or half percentage and start making those increased payments now. It will not only prepare you for managing your budget when the interest rate increase actually takes effect, but will also reduce your overall mortgage debt quicker, saving you money in interest. Savings accounts have offered fairly low rates of interest at the moment, so mortgage borrowers could stand to save more by using their savings to reduce their mortgage debt quicker.

Another resolution that home owners should consider is to look at how their current mortgage product compares to deals on the market. There are a lot of low fixed rate deals on offer but those will start to fall away as we get closer to an interest rate rise. Mortgage borrowers who took out a two-year fixed deal in 2013 should definitely be looking at their remortgage options before their monthly mortgage payments start to increase.

If require a property conveyancing solicitor in Northern Ireland to act for you in respect of a remortgage, sale or purchase, contact Wilson Nesbitt in Belfast or Bangor by calling 0800 840 9290.