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Martin Lewis suggests 'first thing' people with fixed-rate mortgages ending soon should do

Daily Express logo Daily Express 28/09/2022 Jackie Annett
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Money Saving Expert founder Martin Lewis told ITV's This Morning viewers that they should consider acting now if they are on a fixed rate mortgage deal that is ending soon, however he did add a 'caveat'. His comments came after Virgin Money, Halifax and The Skipton Building Society removed some of their mortgage deals amid rising interest rates and uncertainty in the markets.

Speaking on This Morning, Martin Lewis said millions of people could be sitting on a mortgage "ticking timebomb" and the current uncertainty in the market was "unprecedented".

He said lots of people are worried and have been asking if they should be looking for a new fixed rate right now.

Agreeing with a concerned viewer, he said: "It is scary, it is uncertain and it's changing by the hour. I have to caveat that nobody really knows where we're going right now."

"So the first thing anyone who's got a mortgage that is variable right now, or a fixed coming to an end should do, is to quickly get yourself onto a comparison site to see what's available.

"You should talk to your own lender to see if they've got any existing deals 'cause they can be easier to get and there are no fees."

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Martin Lewis and rate rise graph © GETTY/ITV Martin Lewis and rate rise graph

He continued: "And you should definitely at this time, especially if you're an inexperienced with mortgages, be using a good, independent mortgage broker.

"They are experts in mortgages so they can guide you through the pros and cons and crucially they know the affordability criteria that tend not to be available for consumers.

"Will you pass the affordability score, will you pass the credit score?

"So you want a quick look go to a comparison site - check with your existing company but if you're really ready to do this then I would, in most cases, be looking for a mortgage broker to help you with it."

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Sam Richardson of Which? Money, said 935 motgage deals were pulled overnight leading to "turmoil in the mortgage market".

He explained: "If your deal ends in the next six months you may be able to lock in a new one now before rates rise further. But think about your medium and long-term plans when you're looking for the right mortgage.

"Fixed-term deals usually come with early repayment fees, so you could be charged thousands of pounds if you move house and don't take your mortgage with you.

"If you're struggling to pay your mortgage bills, talk to your lender about what support it could offer. This could include a temporary payment holiday, lengthening the term of your mortgage to cut your monthly instalments or switching you temporarily to interest-only repayments."

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Budget squeeze infographic © Express Budget squeeze infographic

Virgin Money said: "Given market conditions we have temporarily withdrawn Virgin Money mortgage products for new business customers.

"Existing applications already submitted will be processed as normal and we'll continue to offer our product transfer range for existing customers. We expect to launch a new product range later this week."

Rachel Springall, finance expert at Moneyfacts.co.uk, said: "The upheaval in the mortgage market may cause frustration amongst both borrowers and brokers as they see deals disappear overnight.

"The market remains considerably volatile so it's vital consumers seek independent advice to assess what their best options are right now."

The real losers will be first time buyers, claims Vadim Toader, CEO of lender, Proportunity.

He explained: "With the news that mortgage products will be withdrawn for new customers, it is yet again first-time buyers who are being hit hardest by the UK's economic woes.

"The weakening of the pound and increasing interest rates has put lenders in a tough position, where it is not viable for them to offer the mortgage rate deals, we were seeing only last week.

"This means, to access a decent rate, home buyers will need significantly higher deposits."

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