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, according to recent research by Countrywide and online mortgage adviser Dynamo.
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.
Aside from sit on old mortgages and loans, D J Alexander Financial Services points out that many landlords also have unchecked insurance, and inefficient financial management practices which are costing them enormous sums of money and may threaten the future viability of their investments.
Alan Kent, head of DJ Alexander Financial Services, commented: “We have estimated that one in three landlords are paying too much for their mortgage which is a simple fix and could save thousands of pounds.
“Being a landlord has become much more complicated in the last couple of years and many people may not realise just how stringent and problematic the impact of many of these changes will be on their investment.
“Income will be hit as rents remain relatively static or falling across the UK, while costs are rising, and the ability to offset expenses hits profitability.”
Ken t added: “There are ways to reduce costs at every stage and at every level of business, but they don’t magically occur, and homeowners must examine all financial aspects of their investments to ensure they are maximising their income.”