Mortgage advice

If you are coming to the end of a fixed rate mortgage, or tied-in period, it's a good idea to shop around for a better deal. Failure to do so could mean you end up paying your lender's standard variable rate (SVR) which could be far higher than what you have been used to paying. Although the credit crunch means there are now fewer mortgages available, people with a decent deposit or equity in their homes and a fault-free credit rating should still be able to secure a good deal.

Check out our mortgage advice for some great saving tips:

• Look beyond the headline: The Key Facts Illustration (KFI) provided by your lender will give you a personalised quote for the total cost of a mortgage. Depending on your circumstances, a slightly higher monthly interest rate with no arrangement fee might be a better deal than a lower rate with a large fee up front.
• Mortgage overpayments can save you money: The size of most mortgage loans and the standard 25 year term means that the amount paid back in interest is much greater than the amount originally borrowed. Reducing the outstanding capital by even a small amount makes a big difference. Overpayments substantially reduce the length of your mortgage and therefore result in lower interest costs. You will however need to check with your mortgage lender to see what kind of overpayments they allow as restrictions often apply.
• Ask for two mortgage illustrations, one with and one without arrangement fees: This will allow you to fully understand the impact on the total cost of your mortgage before making a decision. If you do not have the cash available to pay the fee up front, putting arrangement and exit fees onto a mortgage account is an option, but you should be prepared for the extra costs to be reflected on the monthly mortgage repayments. The average cost to set up a mortgage is currently £1,000, but this more than doubles to £2,100 if the fees aren't paid up front.

Once you've taken your mortgage out, if you begin to struggle with an increase in mortgage payments, taking in a lodger can ease the strain. The Government's Rent-a-Room scheme means you can receive up to £4,250 a year from a tenant tax-free.

Our final piece of mortgage advice is to always consider the cost of exit fees before you switch mortgage providers. These currently stand at £163 on average, although consumers can expect to pay anything up to £295 to move to another provider.