Annual mortgage statements will be landing on doormats across the country this January, but don’t just file yours away without checking your current rate. Lenders typically send out annual mortgage statements in the New Year, so many should receive it by the end of January if not before.
What your annual statement shows
Your statement contains lots of useful information about your mortgage, including your remaining mortgage term, your mortgage balance at the end of the year and how much you’re paying each month. It shows the total amount you’ve paid in to your mortgage over the year including any overpayments, as well as how much interest you’ve been charged. The statement also confirms the type of product you’re on, for example whether you’ve got a fixed rate mortgage, where your rate remains the same for a set period, or a variable rate mortgage, which may change over time, resulting in higher or lower monthly payments. It will state whether your mortgage is on a repayment or interest only basis. It will also carry the all important information of the interest rate you are paying and have paid over the course of the year.
How to use this information
When you receive your mortgage statement, make a note of your interest rate, the kind of deal you’re currently on and how much your monthly payments cost. If you’re not locked into your existing mortgage and there aren’t any early repayment charges to pay if you switch to an alternative deal, see whether you could be getting a better rate elsewhere. Our research found that more than 4 million homeowners are paying their lender’s standard variable rate (SVR), despite the fact that switching to a cheaper deal could potentially knock hundreds of pounds a year off their mortgage costs. If you’re not sure whether you could save by remortgaging, speak to one of our advisers who can guide you through the available options. Bear in mind too that you can secure a mortgage rate in advance, so even if you’ve got between 3 and 6 months left on your current mortgage you can sign up to another deal, and arrange for it to begin as soon as your existing mortgage deal ends.
