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  • FIRST POST
    • SMC0325
    • By SMC0325 10th Jan 18, 8:50 AM
    • 3Posts
    • 1Thanks
    SMC0325
    End of fixed rate - only 15000 owing but no 12 month deals
    • #1
    • 10th Jan 18, 8:50 AM
    End of fixed rate - only 15000 owing but no 12 month deals 10th Jan 18 at 8:50 AM
    My fixed rate mortgage ends in July 2018 and I will have around £15000 left. However at the end if the fixed rate I revert back to the standard rate of over 4% with no 12 month only deals available. Is there a better way to clear the remaining £15000 in 12 months avoiding the 4%
Page 1
    • Mortgage_Adviser
    • By Mortgage_Adviser 10th Jan 18, 9:58 AM
    • 76 Posts
    • 33 Thanks
    Mortgage_Adviser
    • #2
    • 10th Jan 18, 9:58 AM
    • #2
    • 10th Jan 18, 9:58 AM
    With such a small mortgage and short term the monetly diference would be around £23 if yoi wee to cut it by half or so, so personally I would not bother doing anything.

    There are a couple of lenders who have a minimum mortgage term as 1 year so if you can find them and they can get you a mortgage fee free, as no point of paying any fees here as these will wipe out any savings.

    You may want to try a fee free broker here such as London & Country. Although I would not normally suggest using fee free brokers, agian in your situation any whatsoever fees paid would wipe out any savings.

    P.S
    L%C will then enjoy their £45 or so comission earned of the case )))
    • TrickyDicky101
    • By TrickyDicky101 10th Jan 18, 10:29 AM
    • 2,890 Posts
    • 1,856 Thanks
    TrickyDicky101
    • #3
    • 10th Jan 18, 10:29 AM
    • #3
    • 10th Jan 18, 10:29 AM
    Agreed - it's not worth worrying about if you will only have 12m to maturity.
    • getmore4less
    • By getmore4less 10th Jan 18, 10:57 AM
    • 31,168 Posts
    • 18,681 Thanks
    getmore4less
    • #4
    • 10th Jan 18, 10:57 AM
    • #4
    • 10th Jan 18, 10:57 AM
    My fixed rate mortgage ends in July 2018 and I will have around £15000 left. However at the end if the fixed rate I revert back to the standard rate of over 4% with no 12 month only deals available. Is there a better way to clear the remaining £15000 in 12 months avoiding the 4%
    Originally posted by SMC0325
    You don't say what the full term is but there are a number of options.

    If full term is longer than 2 years take a 2 year deal and do max overpayments.

    looking at some numbers

    £15,000 @ 4% 1year £1,277pm total interest £327
    £15,000 @ 1.75% 2years £636pm total interest £275

    10% overpayment say £750pm
    £15,000 @ 1.75% 2years £750pm total interest £234

    if you only have 1y full term

    I would look at a 0% CC if there is one with no fee on a BT that would work or look for a 0% purchase card and stick all spending on that using the cash to pay of the mortgage earlier.

    if you have say £500pm/£1000pm spends that can go on the CC on top of a normal 1y payment plan.

    £15,000 @ 4% 1 year £1,777pm total interest £241
    £15,000 @ 4% 1 year £2,277pm total interest £193

    if that was at a lower rate say 1.75% £84 interest

    What deals does your lender have?
    Some have trackers/discount that have unlimited overpayments
    • SMC0325
    • By SMC0325 11th Jan 18, 7:16 AM
    • 3 Posts
    • 1 Thanks
    SMC0325
    • #5
    • 11th Jan 18, 7:16 AM
    • #5
    • 11th Jan 18, 7:16 AM
    Thank you for your responses... full term left is about 2.5 years but the fixed rate ends in July. However I need to clear the balance within 12 months of July as I will then be retiring and need to be mortgage free.... have used up my max 10% overpayments this year, but assume once the fixed rate ends in July I can pay whatever I like to speed it up and get it cleared within a further 12 months?
    • AnotherJoe
    • By AnotherJoe 11th Jan 18, 8:47 AM
    • 7,901 Posts
    • 8,494 Thanks
    AnotherJoe
    • #6
    • 11th Jan 18, 8:47 AM
    • #6
    • 11th Jan 18, 8:47 AM
    Why do you need to be mortgage free when you retire ?
    • TrickyDicky101
    • By TrickyDicky101 11th Jan 18, 9:28 AM
    • 2,890 Posts
    • 1,856 Thanks
    TrickyDicky101
    • #7
    • 11th Jan 18, 9:28 AM
    • #7
    • 11th Jan 18, 9:28 AM
    Thank you for your responses... full term left is about 2.5 years but the fixed rate ends in July. However I need to clear the balance within 12 months of July as I will then be retiring and need to be mortgage free.... have used up my max 10% overpayments this year, but assume once the fixed rate ends in July I can pay whatever I like to speed it up and get it cleared within a further 12 months?
    Originally posted by SMC0325
    That is highly likely to be true although you should check your mortgage agreement to confirm.
    • SMC0325
    • By SMC0325 11th Jan 18, 4:35 PM
    • 3 Posts
    • 1 Thanks
    SMC0325
    • #8
    • 11th Jan 18, 4:35 PM
    • #8
    • 11th Jan 18, 4:35 PM
    Want to reduce e outgoings each month. To continue mortgage payments would be like paying rent and deplete my avail cash flow from pension
    • Thrugelmir
    • By Thrugelmir 11th Jan 18, 6:01 PM
    • 56,711 Posts
    • 50,080 Thanks
    Thrugelmir
    • #9
    • 11th Jan 18, 6:01 PM
    • #9
    • 11th Jan 18, 6:01 PM
    but assume once the fixed rate ends in July I can pay whatever I like to speed it up and get it cleared within a further 12 months?
    Originally posted by SMC0325
    That's the way to do it. Have you any savings to call on?
    “Opportunities come infrequently. When it rains gold, put out the bucket, not the thimble”
    ― Warren Buffett
    • makemesumdosh
    • By makemesumdosh 11th Jan 18, 9:49 PM
    • 313 Posts
    • 90 Thanks
    makemesumdosh
    WHAT WILL YOUR EXSISTING LENDER DO FOR YOU.
    Only have 2 years 8 months left on mine. looking to remortgage in April.my lender has been more than helpful. Rate coming down, 2 year fix, reduced term of 2 years, 2 months, keeping payments roughly the same, option to overpay by 10%. I can avoid going onto SVR by doing this.
    • AnotherJoe
    • By AnotherJoe 11th Jan 18, 10:22 PM
    • 7,901 Posts
    • 8,494 Thanks
    AnotherJoe
    Want to reduce e outgoings each month. To continue mortgage payments would be like paying rent and deplete my avail cash flow from pension
    Originally posted by SMC0325
    But if you could pay it off early before you retired you could just put the money aside you would have used in a relatively high interest account and then pay it down from that money, thus getting the best new deal you can before you retire.
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