Bradford & Bingley

mstar

ok mine discouted rate of mortgage ends in march 2010. Should i try to secure a deal before then? like now?????? or see if the markets pick up. as my contract says 2% above the bank rate after my discounted rate of 2yearsa

luckyfool

mstar wrote: »

ok mine discouted rate of mortgage ends in march 2010. Should i try to secure a deal before then? like now?????? or see if the markets pick up. as my contract says 2% above the bank rate after my discounted rate of 2yearsa

Basically that means that worst case scenario, when your deal ends you will be on 2% over base (or 7% currently). The lender cannot vary your rate above that margin so you have a degree of protection.

What type of deal do you have just now? Buy to Let, Self Cert? Mainstream standard full status residential mortgage? 100% +?

Roughly what loan to value do you think you have? i.e. loan size and conservative value of property? Do you have a penalty for leaving your current deal early?

mstar

i have a self-cert, and i put down 10% deposit. Loan is for 25 years.
the property has not budged in price but i am planning to over pay every month to chip away on my mortgage.

property purchased for 300k, mortgage roughly 270,000, no exit fee to end deal after 2 years

property worth around same price (300-305k) as i did some renevations to it.

i estmated i put my savings (roughly 18k) into overpaying my mortgage so my loan size decreases and i get a better deal in 2 years time.

is my thinking logical??? i dnt really want to use my savings but i might have to to get a good deal

luckyfool

I take it you have a penalty now?

Have you already overpaid into the mortgage so it is less than £270k o/s now?

Can you prove your income now . . . or will you be able to prove it by the time the deal ends or will you still require Self Cert?

mstar

i can prove my income, by 2 years as my wife and me have better paid jobs now.

i have not overpaid yet, but i will start to chip away at my mortgage for a good rate and income ratio when my deal expires in 2 years

luckyfool

That's the sensible thing to do. Overpay, keep chipping at that mortgage balance, and also plan for having to potentially pay the SVR in the event that you are unable to improve on that rate when you want to remortgage in two years. Assuming your circumstances remain the same, i.e. good credit, can prove income, etc then as long as your house value hold up reasonably well and you have overpaid enough so that you are only looking for 90% then you should be in a position to remortgage (based on lenders criteria just now, of course it could be different by then).