If you are a homeowner, are in work and have no debt other than your mortgage then times are actually quite good. Yes, there is lots of doom and gloom in investment markets and the cost of many of life’s essentials has been going up but what is probably one of your biggest expenditure items, your mortgage interest bill, could be at an all time low. Some people who set up tracker mortgages prior to the credit crunch are paying exceedingly low interest rates, less than 1% p.a. in some instances. If interest rates rise, so will mortgage costs so if you are on an attractive rate, you need to make hay while the sun shines and squirrel some of this interest saving away.
Mortgage payers benefiting from nearly years of low interest rates can look forward to more of the same in 2012 – a rise in interest rates over the next year is pretty unlikely. However the current flat line will end at some stage and rates will rise. In the meantime, low mortgage costs provide the opportunity to pay down debt, build cash savings in tax efficient accounts such as ISA or boost pension funding.
If you have a mortgage, you’ve probably never had it so good! Rates are at an all time low, have been for the last two years and probably will be for the next two. Take the opportunity to keep your mortgage repayments up at the high level they once were and you will take hefty chunks out of the balance. You will find yourself mortgage-free, years ahead of schedule. Factor in the likelihood that house prices will eventually climb back to where they once were and yes, you’ve never had it so good!
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