Savings gain from remortgages could offset NI rise

The savings gained from remortgaging could offset the increases to National Insurance (NI) proposed by the government, according to Habito.

Raising NI by 1.25% for employees could mean someone earning the average UK salary (£31,461) will be paying an extra £274 a year in taxes.

However, research from Habito has found that the average homeowner can save approximately £294 a month just by remortgaging from one of the big six UK lenders’ reversion rates or standard variable rate (SVR), equal to a saving of £3,528 across a year.

Habito’s UK-wide study of over 2,000 homeowners found that more than a quarter (27%) were on their lender’s highest possible rate of interest, while almost one in five (18%) did not know if they were or not, meaning the total figure could be 45%.

Rosie Fish, mortgage expert at Habito, said: “Unexpected tax increases can be stressful, especially in uncertain times.

“But there are ways you can cut your costs in other parts of your life – your mortgage being one of them.

“Remortgaging is often made unnecessarily confusing and should be viewed more like switching utility or broadband provider, but with a bigger potential return.

“If you’re not sure what mortgage rate you’re on or would like to know your options, speak to a free mortgage adviser.

“A mortgage switch could balance out those unexpected new tax bills, with extra savings to spare.”

Written by: Houseladder