Beyond its health ramifications, the COVID-19 pandemic has also affected family income for a significant number of people. Many of those are homeowners who now face the end of their fixed-rate mortgage terms. If you’re one of them, you’re probably wondering what this will mean for your monthly repayments and what you can do about it.

Once your fixed term comes to an end, unless you can negotiate a further fixed-rate deal your repayments will be calculated on the basis of your lender’s standard variable rate (SVR). For many people in this situation, it could represent a substantial increase in their mortgage payments, just at a time when the pandemic has dented their finances. Homeowners are rightly concerned that taking a payment holiday at this point could have an impact on their future mortgage options, and for those who are still furloughed, negotiating a mortgage may be problematic.

So, what’s the solution?

Most lenders are trying to be understanding in cases where the pandemic has affected homeowners’ ability to pay, and many of them will consider offering remortgages to bring monthly payments down to an affordable level. Even if your current lender is reluctant to strike a deal, you could go with an alternative lender. For those who want to consider this option, it is probably worth talking it through with an independent broker who will have the knowledge to make the right suggestion for each individual situation – and will be able to identify lenders who are furlough-friendly or who have different lending criteria to your existing lender. Remortgaging could save significant amounts on your monthly outgoings.

For most people, the difference between the rate they are paying on their fixed deal and the SVR that they will move to could be somewhere in the region of two percent – in other words, quite a hike in the cost of your mortgage when you revert to the SVR. You can use a mortgage repayment calculator to see how this will affect your monthly mortgage payments.

If you can remortgage on a new fixed-term deal, you should be able to mitigate the impact of such a precipitous rate increase. The average five-year deal is now approximately 2.75%, which is for many people even lower than their original fixed deal. Even a two-year fixed deal, while not quite as favourable, will still offer good savings on simply reverting to the SVR. Of course, there may be some fees involved in remortgaging and these should be considered as part of the equation, but they should not be enough to put you off the deal, and there are even mortgages available that don’t incur product fees.

The important thing is to find the right mortgage solution for your particular situation, and for that getting the right advice could save you substantial sums in the long run.