By Pat Bunton

It's always good to save money. The Cotton family visited the Cashing In roadshow and found they could cut their mortgage payments by �130 a month just by looking at the best deals around.

Pat Bunton, from London and Country mortgages, has this advice if you're thinking of re-mortgaging.

There are an estimated 11.2 million mortgage holders in the UK.

It is thought that half of them are paying their lender's standard rate, which is the rate that lenders usually charge existing customers.

Perversely, this is usually far higher than the rates they offer to attract new customers. Some reward for loyalty!

So why is this? Basically, most lenders cannot afford to transfer all of their existing customers to a new market-leading business rate.

Instead, they often use low initial rates as the "sprat to catch the mackerel" in the hope that they will make money later when you either pay the standard rate, or when they sell you other products...

Be aware

Financially aware borrowers are becoming increasingly aware of these tactics, and are re-mortgaging or changing mortgage lender as a way of fighting back.

The Cottons found they could save �130 a month on their mortgage

Many are simply shopping around for the best rate and moving their mortgage from one lender to another.

We all hunt for the best deal when making a major purchase, so doing the same for a mortgage makes absolute sense. It is, after all, the biggest purchase we are ever likely to make.

The numbers are compelling: a customer with a �100,000 interest only mortgage, paying a standard variable rate of 5.65% could typically shave this down to less than 4% by switching lender.

Big deal? Well, actually it is.

Monthly payments would be reduced from �470.83 to �333.33 per month - a massive tax-free saving of �1,650 a year.

So where's the catch?

Pat Bunton recommends shopping around for mortgages

The truth is that as long as you are careful and shop around before jumping from one lender to the next, there should be no catch at all.

It will take a mere hour or so of your time, filling in forms and digging out some paperwork, but this is a small price to pay given the potential savings.

Put another way, would you work 3 hours overtime tonight if your boss guaranteed to pay you �1, 650 after tax for doing so?

That was easy! So having decided to consider re-mortgaging, it is important to ensure that you do not have a nasty surprise later.

Here are a few basic tips to consider:

Fees: check if there are any fees. With some mortgages, there are no fees because the lender will pick up the bill. With others, there may well be costs that are passed on to you. If you are uncertain about which option is best for you, then take advice - more on that in a moment.

Redemption penalties: before you swap lenders, check that your old lender will not charge you a penalty for leaving. If a penalty exists, then make sure that you deduct this from any anticipated savings to see if it is still worth going ahead. Most redemption penalties run for a set period of time, so if they do deter you now then make a diary note and consider the issue again when they expire. Equally, before re-mortgaging, check the small print and avoid mortgages that tie you to the lender for longer than any incentive or lower rate period. This means that once the incentive period expires, you will be free to shop around and hopefully will enjoy similar savings all over again!

Deadlines: the easiest thing in the world is to put re-mortgaging off to another day. Don't allow lethargy to stop you. The fact that you might not be getting the best deal on the market will cost you some of your hard earned cash each and every month that you delay re-mortgaging. Surely it is better that this money is in your pocket and not in your lender's?

Assuming that all goes smoothly, the transfer of your mortgage from one lender to another should take roughly six to eight weeks.

So the sooner you get going, the better.

Sounds good so far, but re-mortgaging might still seem daunting and you may be worried about making the right decision?

However, the good news is that there are plenty of experts out there who can help.

Where to get advice?

You could seek advice from your bank or building society, but with more than 4,000 mortgage products in the UK it is pot luck as to whether or not they will have the market leading product when you call.

Also, bear in mind that lenders can only talk to you about their own limited product range.

Plus they have a vested interest in you paying as high a rate as possible - if not now, then in the future.

In contrast, a broker should - by definition - work for you to find the best possible mortgage to suit your own individual circumstances.

If you choose the broker route, make sure you check that they are independent and that they recommend from the whole market and not from a restricted panel of lenders.

Also check whether they will charge you a fee - which will typically be 1% of the mortgage amount.

However, if you look around you will find firms (like London and Country) that will advise you without a charge.

Mortgage code

Irrespective of your choice, make sure that your adviser is able to give you the highest level of service under the Mortgage Code, namely "advice & recommendation".

If they only offer an "information only" service, then you must be aware that you (not they) are taking responsibility for making sure that any mortgage taken up is suitable.

One way of spotting a good adviser is to see if they check the deals that your existing lender might offer.

If they do - great. If they don't, then it may be an indication that they are more interested in themselves than in you.

And finally...

If you are ever uncertain or unsure about anything, then make sure you ask your adviser to explain things again and again until you are completely comfortable.

After all, a mortgage is the largest financial commitment you are ever likely to make, so don't be embarrassed to ask for help.

Getting it right first time is essential for your future financial well being.