Buy-to-let landlords are being reminded to do all they can to avoid the trap awaiting borrowers when fixed-rate mortgage deals end.
A third - 33% - of mortgage holders ended up on their lender’s Standard Variable Rate (SVR) last year, costing them on average £371, a new study by Countrywide and online mortgage adviser Dynamo, shows.
Remortgagers who left their mortgage renewal too late spent an average of 42 days on their lender’s SVR at an additional cost of £61.83 per week on average, according to the research, which calculated the cost of not remortgaging before the existing mortgage product expires by tracking the proportion of people who ended up on their lender’s SVR in 2017 and how many days they remained on that rate.
Seb McDermott, CEO at Dynamo, recommends that mortgage holders start their search for a remortgage around four months before their existing deal is due to expire.
He said: “The research shows that far too many people are not switching mortgage deals in time.
“Last year, one in three mortgage holders ended up on their lender’s SVR rate for an average of 42 days after their existing deal expired. This can prove costly - to the tune of nearly £62 a week for the six week period - which is more than the average family food shop.”