Cheap Remortgages: Remembering the Impact of Interest Rates
Credit crunch, housing crisis, foreclosure and inflation are all terms that we are becoming intimately familiar with. If you have not experienced the
meaning of these terms personally, you may still know someone who is struggling with them. All of this uncertainty along with the rising cost of food,
fuel and virtually everything else has prompted many to look for ways that they can save. One of the most expensive and obvious places to save
money is housing. Obtaining a cheap remortgage could save you a lot of money that you could certainly use during difficult times. How much could a
cheap remortgage save you? Of course, the actual amount you can save will depend entirely on the size of the remortgage and your interest rate on
the loan. It’s also worth remembering why your mortgage costs so much in the first place. Obviously you know that you have to pay back the amount
that you borrow over whatever period of the mortgage (typically 25-20 years), but it’s easy to forget that with a repayment mortgage the vast majority
of the amount you pay back each month is going toward the principal balance of the loan. If you were paying back a £100,000, 25 year mortgage at
6% interest, less than £150 of the £644 monthly payment is actually going towards paying back the core loan. The rest is in interest so you can really
save a lot of money if you secure a lower interest rate with a cheap remortgage. It’s worth repeating that even seemingly small differences in interest
rate can have a massive financial impact over 25 or 30 years. If done well, remortgaging can have a hugely beneficial effect on your finances.
Everything that you save with a cheap remortgage can be put to better use. You will still have the same home. It will still be worth the same amount of
money. You could be paying less for it. And the money that you save can be used to buy food, petrol, clothing…all of the necessities that may be
making things tight with your current mortgage. Who knows, yo