02 Nov Could We Secure a New Mortgage Rate Before the Lender Increased Its Rates?
How acting on the same day helped one client arrange their next fixed-rate deal before the lender changed the rates available on new products.
A mortgage deal coming to an end
A client contacted us on a Thursday morning because their existing fixed-rate mortgage deal was approaching its end date. With everything else going on in life, reviewing the mortgage had slipped down the list of priorities.
They wanted to understand their options and arrange what would happen when their current deal expired. What they did not know was that their existing lender was about to change the rates available on its new mortgage products.
Why did the timing matter?
While reviewing the client’s options, Max identified that the lender was due to increase rates on new mortgage products the following morning. That created a short window in which the client could secure a rate that was still available that day.
Importantly, this was not an increase to the interest rate on the client’s existing fixed-rate mortgage. Their current deal would continue on its agreed terms until it expired. The change concerned the rates being offered for new deals.
Waiting until the following day could therefore have meant that the particular rate available on Thursday was no longer an option. It did not necessarily mean that every alternative deal would have been more expensive.
What did Max do?
Max reviewed the client’s circumstances and arranged a new mortgage product with their existing lender on the same day. This was a product transfer, rather than a move to a different lender.
The client secured the rate available before the lender’s planned increase. The new deal was arranged to start when their existing fixed-rate deal expired — not immediately.
That distinction mattered: the client did not have to end their current fixed-rate period early simply to secure the next deal.
What was the outcome?
The following morning, the lender increased the rates available on its new mortgage products. By then, Max had arranged the client’s new deal at the earlier rate, subject to the lender’s applicable terms.
The client could continue with their existing mortgage deal until its scheduled expiry, knowing that a new product had been arranged to follow it.
This was a useful outcome in a time-sensitive situation, but it is not something we could promise for every client. Product availability, lender processes, eligibility and timing all affect what can be arranged.
Why is it worth reviewing your mortgage before your deal ends?
The real lesson from this case is not to leave your mortgage review until the last minute. Although Max was able to act quickly here, earlier conversations generally allow more time to compare options, understand the costs and decide what suits your circumstances.
Many lenders allow borrowers to arrange a new mortgage product several months before an existing deal ends, although the timing and conditions vary. A review can also help establish whether staying with your existing lender or considering a remortgage elsewhere is more appropriate.
If your fixed-rate deal is approaching its end, it may be worth checking the expiry date and speaking to a mortgage adviser sooner rather than later.
A couple of common questions
When should I start looking at my next mortgage deal?
Around six months before your current deal ends can be a useful starting point, as some lenders allow you to reserve a new product that far in advance. The available window varies by lender and product.
Will my existing fixed rate increase if the lender raises rates on new products?
Not simply because the lender changes the rates it offers to new applicants or existing customers arranging a new deal. Your current fixed rate generally continues until its agreed end date, subject to your mortgage terms. The rate applying afterwards depends on what you arrange and your lender’s terms.
Is staying with my current lender always the best option?
Not necessarily. A product transfer can be convenient, but the right choice depends on the rates, fees, features, eligibility and your wider circumstances. It is worth comparing the available options.
Could your mortgage deal be coming to an end?
If you are approaching the end of a fixed-rate mortgage, we can help you review your options and understand the timing before you need to make a decision.
Your home may be repossessed if you do not keep up repayments on your mortgage.
Max Billingham DipPFS, Cert (MP)
Trainee Mortgage & Protection Adviser