Yorkshire Building Society has told homeowners with a shorter term left to run on their mortgage to consider whether they could save on their monthly repayments.
‘Last time buyers’ will often be paying a standard variable rate (SVR). The Yorkshire said that almost £300 billion of the country’s mortgage debt is represented by homeowners repaying at SVR, £49 billion of which is outstanding on mortgages of less than 40% LTV.
The Yorkshire is urging such borrowers to consider switching to its Rollover mortgage. It has a rate of 2.99%, lower than the majority of SVRs – is fixed for one year, and has a low, one-off fee of £495.
It is available to borrowers with LTVs of 35% or lower and homeowners who remortgage with the deal are not charged another product fee at the end of the term if they stick with the Rollover product and roll over onto a new one-year fixed rate mortgage.
At least one month before the one year term expires the borrower will receive details of the fixed rate for the next Rollover period and their new mortgage payments, as well as a reminder of their options should they wish to change product.
Jemma Smith, Yorkshire Building Society product manager, said: “The Yorkshire has a reputation for great first time buyer mortgages but we haven’t forgotten ‘last time buyers’, those people who are looking forward to living mortgage-free in a few years’ time.
“Many lenders’ SVRs have been at an all-time low however they are now on the increase and borrowers are feeling the impact of these hikes – combined with an increase in living costs it can mean they are feeling the pinch.
“Just because borrowers have small balances and are close to paying off their mortgage doesn’t mean they can’t save money by switching lender.
“For example, even borrowers with low balances who are currently paying one of the lower SVRs at 3.99% could save almost £30 per month by switching to our Rollover mortgage.
“Here at the Yorkshire we’ve seen rising interest in our mortgages as borrowers are becoming increasingly aware that they could save money by switching from SVR.”