When it comes to mortgage rates, it’s important to adopt realistic expectations and devise a strategy to prepare for your financial future. Read on for what Crew FO has to say about accepting the ‘new norm’ in regards to mortgage rates.

Where Mortgage Rates Are Heading

Following an extended period of very low mortgage rates (during which products starting with a 1 or a 2 were commonly available for many borrowers) those looking to buy or remortgage now need to adjust their mindset and expectations to accept the new norm. It’s most likely that rates will start with a 4 or a 5 – or at least in the short-to-medium term, anyway.

This is especially poignant for yacht crew who have restricted mortgage options to start with, as a consequence of being paid in a foreign currency (dollars or euros).

With pessimistic short-term growth projections for the UK and a higher than ideal level of inflation, it is unlikely mortgage interest rates will – or are able to – go much lower than they are currently. Even though recent weeks have seen some mortgage lenders reducing their rates in an attempt to win business in a subdued property market.

Minimising Impact

Many borrowers are looking towards mortgage brokers to help guide them in their search for the most suitable and, in most cases, the most cost-effective mortgage solution to meet their needs.

This has proven to be an effective strategy for many borrowers, and in particular yacht crew, as the mortgage adviser will have kept a close eye on lender and rate activity in the market to make sure any preferential product offerings are passed on to their customers. This could be for a purchase, a remortgage, or simply transferring to a new mortgage product.

The higher mortgage rate environment is proving challenging for many existing homeowners as they have experienced the “payment shock” of potentially moving from a payment calculated at a rate around 1 or 2 percent to a rate around the 5 or 6 percent mark. This is another reason many people are choosing to use the services of a mortgage broker like Caboodle so that all the potential options can be explored to minimise the impact.

Find out how Crew FO can help you with your finance here.

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