What Really Matters When Buying or Reviewing Your Mortgage
Stop Waiting for Perfect Mortgage Rates
There’s a lot of noise around mortgage rates right now; it feels like everyone is talking about mortgage rates, and it’s worrying. The question on everyone’s lips is, “So is now a good time to buy a house or get a mortgage?”
News headlines, social media posts and chats with your mates can make it sound like the markets are doomed. It’s no surprise that first-time buyers, home movers and homeowners who are thinking about remortgaging feel unsure about it all.
Mortgage Rates Move. They Always Have.
Yes, rates are higher than we would like. But this is not new. Mortgage rates and the housing market have always moved up and down. That’s just how it works.
It is easy to think today’s market is unusual because of the speed it’s changing. In reality, change is normal but perhaps it’s just not usually as rapid and as frequent as we’ve seen recently.
Mortgage rates rise and fall and the UK housing market does the same. These shifts are influenced by inflation, the economy and decisions made by the Bank of England. Other external factors influence the cost of borrowing as well, such as what’s currently going on in the world, which is what we are experiencing right now.
The key point is though, no one can reliably predict what rates will do next or when they’ll be at their lowest. No one has a crystal ball. If only we did! Trying to time the market perfectly sounds like the right thing to do. In practice though, it doesn’t work.
Change How You Think About Rates
Waiting for the perfect rate, the perfect timing or the perfect conditions often leads to delay and higher costs. You don’t want any of that.
While you’re wondering if it is a good time to buy a house or get a mortgage and waiting for that moment, house prices and your circumstances may change. Opportunities could start passing you by.
People buy homes and change their mortgage in every kind of market. High rates, low rates and everything in between. The people I speak to are glad when they’ve done it.
What Actually Matters More Than Timing
If you are thinking about buying, moving home or reviewing your mortgage, these are the questions that matter more than when is the best time:
- Do you have your deposit ready?
- Are you in a stable financial position?
- Can you comfortably afford the mortgage payments?
If the answer is yes, you are in a strong position.
If you’re remortgaging, you won’t have a deposit but you still need financial stability and assurance from a qualified mortgage adviser that you can afford it.
Lenders look at all of this too. Not just the rate but your overall financial situation and they check your affordability.
Is Now a Good Time to Buy or Get a Mortgage?
Instead of asking, “Is now a good time to buy a home or get a mortgage?”, “Are rates perfect?”, or “Are house prices at their lowest yet?”, ask yourself this instead: “Does this work for me right now?”
Mortgage rates and house prices are only part of it. Of course they matter but they are not the only things to consider. When you focus only on rates or prices, you lose sight of what actually makes a good decision.
There is no universal “perfect” time to buy a house or get a mortgage. Your time might be now; it might be later. But it should be based on your circumstances, not market headlines and fears.
If you have a mortgage already, you will need to review it at some point.
Mortgage rates and property prices will change. They always do. Yes, the future is uncertain but your plans and goals matter more than trying to second guess the markets.
Get Clear on Your Options
You don’t buy a home when rates or property prices are perfect. You buy at the time when your life is ready for it. So check where you stand now.
Your current mortgage deal, if you have one, won’t wait; it will expire and you’ll end up on the higher, variable rate if you don’t review it.
So you’re not doing it in a hurry, you should start thinking what to do roughly 6 months before that expiry date. Waiting around could cost you.
If your expiry date is in less than 6 months’ time, don’t worry if you think you’ve left it too late. Just getting started now will help enormously. My Mortgage Gameplan email series will help you prepare either way.
Use my mortgage calculator to get a realistic sense of what your monthly repayments could look like.
Likewise, if you wait around for property prices to fall you could be waiting for a long time. That property you’ve got your eye on may be snapped up by someone else who isn’t waiting for that perfect time to buy. They may have their ducks in a row and it all works for them right now.
If it works for you now then you should probably do it. If you’re not quite ready, there’s no problem waiting a while longer until your ducks are in a row.
I give my clients clear guidance based on their own situation so they know exactly what’s possible. If you’re not asking: “Can I do this now?”, how will you know what’s possible? Let’s talk so you understand your options with me guiding you. It’s much better than trying to guess.