There are plenty of questions arising around Brexit. Not least the effect it will have on our finances once Britain finally leaves the EU. If you have, or are looking to take out a mortgage, then Brexit is probably leaving you a little nervous.
We’ve put together some answers to your most burning questions below.
However, for more detailed information regarding mortgages it’s worth speaking to a mortgage adviser. Not everybody’s circumstances are the same and Brexit may impact them in different ways.
I’m a first-time buyer and nervous about buying my first home
Buying your first home is always a slightly daunting experience, and you are bound to be feeling some trepidation about the effects of Brexit.
With some experts predicting that house prices will drop after Brexit, this could be a huge benefit to first-time buyers. However it could also mean that sellers may delay putting their property on the market until things have settled down. This is likely to put a halt to any price-drops with fewer homes on the market. It’s all about supply and demand but it’s still very much an unknown!
I want to sell my home
The uncertainty that Brexit brings will make both buyers and sellers nervous. With fewer buyers around, it may make it harder to sell your property. The market usually tends to pick up in the autumn as people want to move home before the winter sets in however as Brexit looms closer, the market could look a little different this year.
If you’d rather wait to see what happens post-Brexit then why not use the next few months to get your home ready to sell. Use the opportunity to spruce up your home inside and out, maximising your chances of getting a good price for it once it sells.
If you are worried about falling house prices then you may want to act now. Other sellers may be holding off putting their homes on the market, so it could potentially mean more demand for your home.
How will Brexit affect my mortgage?
With the Bank of England base rate already at a historic low, the chances of this dropping even further seem pretty small. However there have been a few hints from the Bank of England that it could happen again. Mortgage providers are likely to be nervous though so we can’t be certain that they’ll drop their interest rates.
If you’re a risk-taker then you may think it’s worth the wait to see if interest rates drop any lower after Brexit. If you’re in more of a hurry, then you’re still in a good position to get a good deal on a mortgage. Mortgage rates are still extremely low compared to what we’ve seen in the past. Fixing a good rate now will give you the security of knowing what your payments would be so you can work out affordability over the term of your mortgage.
Is it business as usual until Brexit actually happens?
It certainly seems that way at the moment. People are still buying and selling homes. People are still applying for their first mortgage or remortgaging their current homes despite the uncertainty that the future holds.
Whilst Brexit is bound to be an influence on people’s financial decisions, they are also making sure that their life isn’t put on hold due to a largely unknown factor.
If you are currently buying your first home or are remortgaging, then it may be wise to look at a fixed mortgage rate. This could take away some of the uncertainty for you. A fixed rate enables you to budget around your mortgage payments each month as it will stay the same for the length of your mortgage term.
There is the possibility that you could lose out if interest rates were to fall, but equally there is a small chance that interest rates could go up. Whilst not suitable for everyone due to lack of flexibility or restriction on overpayments, a fixed rate mortgage could help to protect from any unwanted rise in your monthly payments.
Why not speak to one of our helpful mortgage advisers at SoSmart Money? Discuss whether a fixed rate mortgage is right for you or ask any other questions about how Brexit may or may not affect your mortgage.
The above post does not constitute advice – financial, legal or otherwise. The information within this article is the author’s own opinion and do not necessarily reflect the views of SO Media or So Smart Money.
THINK CAREFULLY BEFORE SECURING OTHER DEBTS AGAINST YOUR HOME. YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE.