Mortgage holders who are ‘worried about rates’ urged to check charges

The Bank of England is set to increase interest rates again today meaning the repayments on many variable rate mortgages could go up as well. David Hollingworth, from L&C Mortgages, has encouraged people to review the rate they are on and see if they can get a better deal.He said borrowers may want to look at restructuring their mortgage if they are worried about interest rates continuing to rise.The mortgage expert said: ‘If you are currently in a fixed rate check whether there are early repayment charges and what those would amount to, as they can be substantial (thousands of pounds).’However you can apply for a new deal up to six months before as many lenders will make their offers valid for six months although it can vary.’Those worried about rates continuing to climb can therefore lock in a rate now and switch when the current deal ends.READ MORE: Universal Credit warning as your earnings could impact the amount you get Mortgage borrowers can save on their monthly repayments (Image: GETTY)’That will allow them to avoid drifting onto the lender’s standard variable rate which could have increased from where it is today.’He said one way to reduce the monthly repayments and so ease the pressure on a person’s budget is to lengthen the mortgage term.Mr Hollingworth explained: ‘A £150,000 repayment mortgage over 20 years at a rate of 5.5 percent would cost £1031.83 per month.’Extending the term to 25 years would reduce the monthly payment to £921.13 per month shaving over £100 off the payment.DON’T MISSRishi Sunak pressed on state pension triple lock [UPDATE]Coventry Building Society offers up to 4.85% on new savings accounts [ALERT]Martin Lewis explains how you can avoid being taxed on savings [INSIGHT]70 health conditions qualify for PIP payments worth £627 a month [UPDATE] The base interest rate is expected to increase again today (Image: EXPRESS)’However lenders tend to offer a range of options and incentives to help deal with these which can eat into any potential savings.’Many deals will come with a free valuation and free basic legal work or a cashback for remortgages.’There will often be deals that carry a fee which could typically be £999 but could be higher in some cases.’These may be worth paying in some cases but look at the total cost over the deal period to see if paying a fee makes sense.’