Fixed Rate Increases

Good morning,

Last night we sent a text message out to all our clients who have a fixed rate mortgage coming to an end in 2023.

Due to the news of interest rates continuing to rise in 2023, we wanted to pass on up to date information, so you are prepared for this increase. In some instances, you may choose to look at remortgaging to a new deal now whilst the rates are lower than what is predicted to come.

Some of you have already reached out advising that you are fixed until late 2023, typically high street rates today are around the 4% mark, compared to last year, and the years before, rates were sitting around 1.5%. This is already a massive jump, and experts are forecasting rates to hit 6% in 2023.

Below I have put together a chart demonstrating the effect rates could have on your monthly mortgage payments. The information below is based on the loan size over a 25 year term and shows the payments at a 1.5%, 4% and 6% rate. Use the loan size closest to your current mortgage balance to determine how the increasing rates could affect your payments. Please note these are high street rates, so specialist lenders and building societies have rates that are already higher than 4%.

So what if you are tied in?

As most of you are in the last 12 months of your fixed period, you should only have an Early Redemption Charge (ERC) of 1% of your mortgage amount. We could potentially arrange your remortgage now, pay the ERC by adding it to your loan, and secure a lower rate than what you would be offered in 2023.

This may not be the best advice for everyone. Some of you still may benefit from staying on your current deal, but we will be able to calculate this for you and enable you to make an informed decision.

Ultimately, as a client of CLS Money, our job is to look after you and keep you informed on what is happening in the market.

If you would like to discuss your mortgage with our Remortgaging Team, we have set up a separate mailbox so you can get in touch with them quicker, the email address is remortgage@clsmoney.com.

The team will get in contact with you as soon as possible, but if you would prefer to speak to them straight away you can contact Gemma May, Charlotte Quick or Melissa Woolley on 01268 931611.

Best wishes,

Clayton Shipton

Managing Director