If you took out a special product - for example a 3 year fixed mortgage, or a 4 year tracker mortgage, your original offer letter will tell you when it is coming to an end. That offer letter will also tell you what your new position will be when the special product comes to a conclusion.

If you look at the offer letter and see what happens when the current product ends, more often that not - but by no means always - you will be told that your rate will transfer to the lender's standard variable rate, or to bank base rate(sometimes so much above, or even below (hallelujah!)  bank base rate. If your current mortgage was taken out before the problems of the credit crunch hit us, the standard variable rate quoted on your offer letter could be high - often up in the 7% bracket! But that was then - things are now very very different!  You will revert to the lender's current svr or to the current  bank base rate plus or minus - not the figure quoted in the offer letter.

Before the credit crunch, the immediate aim was under no circumstances to go on to the lender's standard variable rate when a product ended, as this rate was so high. The aim would be to seek out another product with a lower rate again.

However, things have changed dramatically, and in many cases there has been a complete turn around with many borrowers desperately anxious to see an end to what was thought when taken out to be a very competitive rate - in order that they might revert to the lender's standard variable rate,  or a rate tied to bank base rate either of which are currently, in most cases, lower than the product rate!

So what do you do if you have a product coming to end?

1. Give us a call about 6 weeks before your product is due for renewal.  We can tell you virtually straight away whether it would be better to remain with your existing lender or transfer your mortgage to another lender. If you can put your hands on your last offer letter this would provide useful information, but don't worry if this is not available. In most cases you will  revert to a rate associated either with base rate or the lender's  current standard variable rate (svr)  We show below some of the current svr's. (You will notice that these do vary slightly, and in some cases you may revert to the svr or base rate plus or minus a small % but you can check on this: Incidentally we have a number of clients who have reverted to bank base rate minus 0.5% which means that they are currently paying nothing on their mortgage!)

It is important to check whether you will revert to Bank base rate or the lender's svr as there could be a difference. Here is a selection of current svr's of the main lenders.

Abbey 4.24%

Accord (Yorkshire) 5.99%

Alliance & Leicester 4.24%

Birmingham Midshires (varies although 3.99% for Buy to Lets)

Cheltenham & Gloucester 2.50%

First Direct 3.69%

HSBC  3.50%

Halifax 3.50%

Leeds 5.49%

Nationwide 3.99%

Natwest 4.00%

Northern Rock 4.79%

Principality 4.99%

Royal Bank of Scotland 4.00% 

Sandander 4.24%

Woolwich 2.99%

If you are with a specialist or sub-prime lender your standard variable rate could be higher, and as we say, not every mortgage will revert to the standard variable rate anyway.

Remember, the svr of your current lender could have a major bearing on whether you should stay with them or move to another!

2. When your special product comes to an end, you will automatically transfer to the 'reversion' rate and your direct debit will be adjusted. Apart from any other action you may take in the light of what follows, this could be a wonderful opportunity to increase your monthly repayments and so reduce your capital balance outstanding. There are various ways to do this - by asking your lender to increase your direct debit, by setting up a standing order, or asking for a separate payment book so that you can make additional payments as and when you are able. It might also be an opportunity, for example, to alter an interest only arrangement to a capital repayment mortgage, but it may not be advisable to enter into a formal arrangement until you are sure you can maintain this. In any event, you may now enjoy the breathing space of a lower repayment for a while at least.

3. You now have to decide what to do next. Firstly do not be pressurised into taking out a fresh product with your existing lender without checking out any offer with us!  

Remember any offer made might appear to be attractive, but ultimately the lender is thinking mainly of its own interests - not yours!

It is very tempting to just bask in the pleasure of a lower monthly commitment and leave it at that. That could be an excellent policy, and certainly would be, if lender's standard variable and/ or Bank base rates were to stay at the current rate for ever. However, this will not happen, and rates are currently as low as they  are likely to be, and the next interest rate alteration will almost certainly be upwards!

So what do you do? If you feel confident that interest rates generally are going to stay low for a while yet, then you might as well remain on the standard variable rate for the time being, or possibly take a fairly short term tracker mortgage if this can be arranged on reasonable terms. and at better than staying on the svr.

But here's the rub! Depending on the amount of mortgage you have outstanding in relation to the value of your property you may not be able to do anything! If you owe on mortgage more than 75% of the current value of your property (and remember property values have dropped in many areas over the last year or so) you will be hard pressed to get a decent alternative rate anyway. If you have little or no equity (difference between property value and mortgage outstanding) it will almost certainly be inadvisable to consider moving lenders. And of course, if you have a relatively small mortgage it may not be worth changing your mortgage anyway.

If, on the other hand you have considerable equity in your property, you can, as we say, remain on the standard variable rate at least for a time, or you could consider taking out a fixed rate mortgage to safeguard against possible interest rate rises over the next couple of years and to give you some sort of security against future interest rises.

What action you take will depend on your circumstances and requirements. We can fully advise you on this as on all other mortgage matters, but to do this it would be helpful if you can have to hand basic information such as:

Your current mortgage lender

The approximate  current value of your property

The amount of mortgage you have outstanding and whether you are looking to increase your borrowing in order, for example, to pay off more expensive credit.

Your financial circumstances and whether you have experienced any problems with your current mortgage repayments.

We would need other information, but with the above we can quickly tell you whether it would be in your interest to stay with your current lender or look to alternatives