The interest rates will rockets under Jeremy Corbyn – so fix your mortgage for 10 years now

The home of an Englishman is his castle, but yours could be besieged if a public expenditure issue follows a Corbyn election victory.

Although the Labor leader will go through the pockets of the richest to raise taxes to help finance that spree, it is also likely that he will take a cap-in-hand to the bond markets to cover much of the bill to pay.

If he opts for high levels of borrowing, then inflation will follow – and, certainly as the night follows the day, that will feed upward pressure on interest rates. And guess what, our mortgages will cost more.

Lock-in: It is now possible to set loan repayments up to 10 years to guide you through Corbyn and beyond

Lock-in: It is now possible to set loan repayments up to 10 years to guide you through Corbyn and beyond

This threat will become even greater if Corbyn cancels the Bank of England's right to act independently – and starts printing a lot of money to finance a spending action.

So it's time to act quickly and determine the rate on your mortgage – that is, if the concerns of Brexit have not persuaded you to do so.

It is now possible to repay loans up to ten years to guide you through Corbyn and beyond – as well as all kinds of economic setbacks and ups. Experts say that now is the right time for borrowers to get their house in order, regardless of whether Corbyn reaches number 10 or not, because the borrowing rate is still at a bargain.

Fixed rates are also popular because homeowners know exactly how much they need to pay each month for the coming years and can withstand interest rate increases applied by the Bank of England (many guaranteed under Corbyn, that's for sure).

Nine years ago, fixed-rate loans accounted for half of home purchase mortgages. Last year, they made up 95 percent of the new loans, according to the British finance ministry.

David Hollingworth, London & Country mortgage broker, says that anyone with a standard variable rate of a higher street (5 percent on average) must lower (and repair) the mortgage bill before Corbyn causes major damage.

He says: & # 39; Homeowners who have not set their lending rates are missing a trick and can pay thousands of pounds less than the costly standard variable rate of their lender. The direction of the basic rate is upwards and the competitive fixed rates that are available offer an obvious way for homeowners to take control and isolate their finances against further increases. & # 39;

Huge savings can be achieved by taking out mortgage payments. London & Country says that a borrower with a repayment loan of £ 150,000 over 25 years currently paying 5% interest pays £ 877 per month. But taking a biennial fixed price of 1.43 percent at Lloyds Bank – assuming they have 40 percent equity – would cost £ 595 a month, a monthly saving of £ 282 or £ 6,768 over two years.

For many, the idea of ​​having to switch again in two years (when who knows what will become political and economic unrest) will not be appreciated.

A five-year fix offers a longer safety blanket against the worst of Corbyn.

For example, Barclays has a five-year fix at 1.83 percent (£ 999 cost) that lowers monthly payments for a loan from £ 150,000 to £ 623 – a saving of £ 15,000 over five years compared to a 5 percent loan .

For those who want to sleep tightly without nightmares caused by Corbyn for a full ten years, there is a choice of ten-year fixed-rate loans.

Coventry Building Society offers a rate as low as 2.29 percent, but only for homeowners who have 50 percent equity – or a deposit of similar size if they are a buyer.

The appeal of this loan is that it only binds for five years in borrowers, a & # 39; useful feature & # 39; according to Hollingworth because you avoid early repayment costs for the last half of the deal.

Someone exchanging a £ 150,000 loan for this rate would repay £ 657 monthly – a potential saving of £ 26,400 over a decade compared to a five percent loan.

TSB offers a fixed interest rate of ten years at 2.29 percent, but this is less flexible than the Coventry deal with early repayment costs that apply during the ten-year term.


With savings rates still lean, better use of a reserve money is overpaying on the mortgage. The fewer debts homeowners have when Corbyn comes in at number 10, the better.

Hollingworth says: & # 39; By overpaying, borrowers can shorten the term of their mortgage. & # 39;

Most lenders allow borrowers to pay too much up to ten percent per year without an early repayment.

Some are more generous, such as Tesco Bank, which allows up to 20 percent per year.

A few allow unlimited overpayments. Even making small regular arrears can make a big difference in reducing interest rates.

For example, if an additional £ 50 per month is repaid with a 25-year £ 150,000 repayment mortgage with a 2 percent price, the total interest payment would be reduced by £ 4,011 and the loan would be repaid two years, two months earlier.

Paying too much of £ 100 per month would reduce the total interest payments by £ 7,295 and the mortgage would be repaid four years and a month earlier. Double it to £ 200 a month to lower the interest rate by £ 12,354 and repay it seven years and a month early.


Hard-pressed landlords could be forgiven for believing that there was a & # 39; catastrophe from Corbyn & # 39; waiting for them.

As easy lashes for hard-left politicians, landlords can expect stricter controls on rent increases and the introduction of longer rental periods of up to three years.

These plans, already promised by Labor, are only the newest challenges for landlords.

Recent changes in tax breaks – plus the smell of more curbs to impose – have caused an exodus from the market. Many buy-to-let owners have opted to cash in now if the capital gains tax (currently up to 28 percent) rises above Corbyn in the air.

The tenants who live there already feel battered and bruised. The attack on landlords – the blame for fueling property prices beyond the reach of many start-ups – varied from a 3 percent surcharge on the stamp duty paid on & # 39; buy-to-let & # 39; properties, tighter credit terms and a huge pressure on tax exemption available on mortgage interest. In addition, from June, landlords in England can no longer charge rental costs, such as rental renewal or credit check costs.

Such costs will now have to be paid by the lessor. These reforms are housed under a conservatively led government, so landlords must brace themselves for tougher treatment if Corbyn wins the next election.

Sam Mitchell, chief executive of online broker, Housesimple, says: “The net effect of these tax increases is that we have seen the number of landlords rise as the sector becomes less profitable, with more owners likely to go to the exit door as the introduction of Labor changes too quickly. & # 39;

Buy-to-let owners who are determined to stay put cut their costs by remortgaging to cheaper loan transactions. This gives them a certain amount of financial protection as interest rates rise in the future due to Corbyn's misuse of the economy.

Industry Body UK Finance says the number of buy-to-let remortgages in January was at the highest level.

But those looking for a remortgage must brace themselves for strict affordability tests. Lenders are now required to demand that rental income cover mortgage interest with a factor of at least 1.25.

According to online mortgage broker Trussle, the best fixed-rate loans for landlords include a two-year agreement that amounts to 1.98 percent of Virgin Money and a five-year interest rate of 2.5 percent at the post office.