FTB. Torn between 2 tracker mortgages? Which to pick?!

Beckymarshall07

Hi all
I'm FTB looking to buy with husband if offer I have put on property for 115k is accepted. We have 10% deposit and steady jobs. Have decided to opt for a tracker and have found 2 good deals.

First is HSBC lifetime tracker which pegs as 5.95 with arrangment fee of 499 of top of my head. Valuation fee at 149 quid. The bank have agreed to waive arrangement fee as we are both HSBC customers and also we'd found a slightly deal with share to buy - off shoot of britannia.

Second deal with share to buy (britannia) pegs at 5.85 with no arrangment or valuation fee. This would save us doing roughly calculation 6 quid a month in mortgage repayment fees plus the valuation fee being free. Ive checked criteria for share to buy and we are eligible - in fact just had a call from bloke now whos sounded keen but couldnt do a better deal - he just laughed at me:D .

Want to know which do you think is the best deal? Keen to move quickly if offer is acceted etc and also want to bank with a bank which is solid - which I know sounds daft but not sure how big a player britannia are in the market? Anyone used this mortgage?

_dave__4

Sorry I don't know much about Britannia, but this calculator:

http://calc-calc-calc.net/get/calc/Mortgage-Comparison/?L=103500&I1=5.95&Yrs1=2&F1=149&Term1=25&I2=5.85&Yrs2=5&Term2=25

... shows that the difference in cost between the two would be around £360 over two years, or around £700 over 5 years (after allowing for the difference in the outstanding balance as well as the difference between the payments made).

HTH!

0james0

Although short term Britannia may be better you also need to think about how long their tracker is. The lifetime one could mean that if you are happy with it you never need to re-mortgage (saving paying arrangment fees each time)

If the Britania one is say for 2 years, then remember you will be in this position again and possibly have to pay another fee to join another company.

Gorgeous_George

If both are lifetime deals, the Britannia one is best as you have already worked out. Therefore, I guess the Britannia deal is time limited.

I'm on a Britannia lifetime offset tracker (BR+0.74%). It pays me a share of the society's profits each year in addition to being a great deal.

GG

dimbo61

As a first time buyer with a 10% deposit can you afford the mortgage IF it goes up to 8/9% in the next few years ?
Have you got the income to cover a big jump in mortgage costs.
Consider a longer term fixed rate deal of say 5 years to give you time to clear some of the mortgage and build up the equity in your home.
This helps you get a better deal in 5 years as you have over 25% equity providing the housing market has recovered.
The mortgage is most peoples biggest cost each month so think carefully !
GOOD LUCK

Beckymarshall07

Thanks guys. My understanding is Brittania one is a lifetime tracker but I'll check this. I have considered fixing but fixed rate deals are not as competitive and have a horrendous arrangement fee. The good thing about both trackers is that there is no early get out penalty charges meaning I can go else where when fixed deals become more competitive again. Both also have no overpayment chages either so can maintain payments in interests rates go down. We can afford it interests rates go up by 3%.

getmore4less

With HSBC have you checked the cost of becoming a + or premier account holder for the better rate.

this looks like the Share to buy deal throught Britannia.

http://www.sharetobuy.com/britannia.php

Liftime tracker LTV 90% 3.75xjoint income 5.85% no fees

So cheaper than the HSBC offering at 5.95% with £149 fees


They are not part of Britnnia from the web site
"share to buy is entirely privately owned and not 'tied' to any other company"

TheDirector

Beckymarshall07 wrote: »

Thanks guys. My understanding is Brittania one is a lifetime tracker but I'll check this. I have considered fixing but fixed rate deals are not as competitive and have a horrendous arrangement fee. The good thing about both trackers is that there is no early get out penalty charges meaning I can go else where when fixed deals become more competitive again. Both also have no overpayment chages either so can maintain payments in interests rates go down. We can afford it interests rates go up by 3%.

We are currently applying for the Share to Buy mortage with Britannia and to be honest it seems to be the best mortgage around... No one beats it in terms of having a 10% deposit. Its 0.85 above the base rate for the life of the mortgage, with no fees and no tie ins. Even if rates start to increase you will still be initially better off than most mortgages and will have time to get a fixed rate.

I may be missing something, but it seems good to me - hence why we went for it. Went to see a mortgage advisor and he said he could not beat it. We also considered HSBC tracker, but it has fees and is a higher rate. Plus the Britannia one has no fees for valuation.

If anyone has applied for this mortgage and has criticisms please let us know! So far so good -was a bit nervous as first time buyers, particularly in applying online without the help of a financial advisor, but Ive been guided through the process quite well. Still waiting for the full mortgage offer - passed initial stage and have sent off ID and various bits and bobs they've asked for.

Good luck with everything!

Beckymarshall07

Thanks the director thats good to know, Yes we've decided to go with them too. Now alls that needs to happen is for vendor to accept my final offer on house!

Jonbvn

dimbo61 wrote: »

As a first time buyer with a 10% deposit can you afford the mortgage IF it goes up to 8/9% in the next few years?
Have you got the income to cover a big jump in mortgage costs.
Consider a longer term fixed rate deal of say 5 years to give you time to clear some of the mortgage and build up the equity in your home.
This helps you get a better deal in 5 years as you have over 25% equity providing the housing market has recovered.
The mortgage is most peoples biggest cost each month so think carefully!

IMHO, since we look to be heading into a recession interest rates are likely to remain relatively unchanged. However, the big problem is job security. ]

Given the above, I believe that a tracker offers you better flexibility in the forthcoming storm. Furthermore, you don't fall into the fixed rate trap of continually remortgaging and paying a lot of mortgage fees.