Should You Remain With Your Current Bank Or Look For A New Mortgage Lender?

If your current mortgage offer is about to come to an end, do you stick with your existing mortgage bank, or swap to a new lender? What are the advantages to staying with the building society you are with currently and the advantages to moving to a new bank. Getting it wrong can be a very costly mistake and could, in the worse circumstances, mean that you lose your home. Get it right and you could save a small fortune. There is no right or wrong answer, only you can guess what will be right for you in your circumstances.

If your mortgage history with your current bank is favourable, then this can go in your favour. If you have always made payments on time and have an exemplary credit history with your building society, then they might be more eager to keep you and make you a lower offer on the new rate. Talk this through with them shortly before your mortgage deal comes to an end and give them chance to make you a good offer. Staying with the same lender might mean that you can negotiate that when you move offers some of the fees are reduced or waived. For example, you may be able to avoid having a survey on your house to prove its current value.

Of course, there might still be a lender on the market that is able to offer you a better deal whether or not you have a perfect credit rating. You might find that your lender is relying on you taking the easy path and not bothering to give you a good offer. In this case, another lender might be able to offer you a lower ongoing interest rate.

But when you compare mortage rates, it is not just the annual percentage rate that you should look out. Remember to consider how much it is going to cost you to complete your existing mortgage, your building society will have stated fees for deed release and other charges. Also there will possibly be fees that your new bank will charge you, such as legal fees, survey fees and arrangement fees. Some of these can be quite considerable and can hit your pocket hard.

When you are comparing the cost of moving to a new lender, you must consider all fees associated with the move as well as comparing mortgage rates. Also take care to check that all tie in periods are carefully considered. Your existing building society might only lock you in for a year after your offer period, whilst the new bank might lock you in for 18 months, 2 years or more. If you are on the standard variable rate for a lot longer then this is another potential cost to consider.

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