Remortgage or Loan

Willow147

Hi,

I'm in the fortunate position where I only have a £30K mortgage (after (hopefully) cashing in endowments and repaying off some of the capital).

I've just been for a chat with a high street bank and got a quote for a 5 year fixed rate mortgage (over a full term of 7 years) whih equated to about £450/month.

I was also advised by someone (at a different bank) that maybe I should consider a loan instead of a mortgage. Using an online comparison sight, I can get a loan for 7 years for £30K for £444/month.

Are there any advantages/disadvantages of going down the loan route, are there any alarm bells ringing is peoples ears about this?

Thanks for any advice.

ISN-IFS

Willow147 wrote: »

Hi,

I'm in the fortunate position where I only have a £30K mortgage (after (hopefully) cashing in endowments and repaying off some of the capital).

I've just been for a chat with a high street bank and got a quote for a 5 year fixed rate mortgage (over a full term of 7 years) whih equated to about £450/month.

I was also advised by someone (at a different bank) that maybe I should consider a loan instead of a mortgage. Using an online comparison sight, I can get a loan for 7 years for £30K for £444/month.

Are there any advantages/disadvantages of going down the loan route, are there any alarm bells ringing is peoples ears about this?

Thanks for any advice.

Hello,

You raise an interesting point but from my experience a mortgage route has always seem to be the cheaper route in terms of financing. In most cases lenders will accept a minimum 5 year term. With a good clean credit and full status application you can expect to pay rates from 5.75% on a 5 year fixed rate, (subject to status).

In terms of a secured loan from my understanding rates range around the 7-8%.

There are many other factors to factor in before and informed advice can be offered.
I hope this help and if you require more information or advise or assisance send me a personal message.

Charles

payless

charles please read the rules regarding advisers posting on these boards - in particular

a. need to identify by way of signature
b. not allowed to ask people to contact you

most will be found at http://forums.moneysavingexpert.com/showthread.html?t=325378

Willow , an unsecured loan ( if fixed rate) may well be cheaper in terms of rate and/or fees- I have recommended to a few - but whether you get the advertised rate is another thing, also a little less flexible if need to increase / extend

_Andy_

If it's £30k then the loan will be secured on your home.

payless

although of if 2 seprate providers were used , it could be used, but yes I think the OP quote was based on a particular secured deal, if that rate was attainable then it would cheaper than some 5 yr fixed mortgages ( but deare than others) ... may well have less fees... but with current rates there's no great advantage over a "normal" mortgage" - just ensure you get best value taking rate & fees into account