Don’t be afraid to switch – now is a great time

BORROWERS in many developed countries have been benefiting from ultra-low interest rates for the last number of years.

The idea behind the policy was to kick some life back into the economy following the cataclysm of 2008.

How effective they have been in achieving that is up for debate. But there’s no doubt that Western economies are in a good place at the moment.

Growth in the EU economy is at a 10-year high. And if the rate of growth continues to increase, it’s clear that interest rates will need to increase to prevent the economy overheating.

The European Central Bank is the body that will have to make the decision. It determines interest rates for the eurozone, and has embarked on a gargantuan spending spree to try to boost the economy.

That is now being wound down and most observers are expecting the ECB to lift interest rates next year.

If you’re lucky enough to have a tracker mortgage (one which hasn’t been wrongly taken away by your bank), you’ll have been reaping the reward of the low rates. But as rates rise you’ll start paying more. If they rise substantially, you could end up paying a lot more. If you have a variablerate mortgage, you are most likely in the same boat.

That means it’s time to take stock as the lowinterest rate environment begins to come to an end.

There is never a bad time to compare the price of your mortgage to others, but now is a particularly opportune time. It’s worth giving consideration to a fixed rate – just try to time it right if you make this decision.

Get informed about all your options, and don’t be afraid to switch.