Base rate cuts helping you become MF?

jamesd

Redbedhead wrote: »

Where are you getting savings accounts at a good rate at the moment?

Try the best savings accounts article and use the fixed rate accounts for any lump sum you have available. 5.75% from ICICI (with FSCS protection), 5.75% (Anglo-Irish bank, not FSCS, Irish government). For pure UK fix there's Clydesdales at 5% and Northern Rock at 4.5% both for a year.

If your mortgage allows you to draw down overpayments it'd be useful to draw down a year of overpayments and deposit that, then overpay into the mortgage to top it back up. If it allows a lump sum repayment at any time then you might even go with drawing down up to the 50k FSCS limit. Then stick the 50k plus interest back into the mortgage after the fixed term. But you can't do this if unemployed or it'd probably be treated as savings and eliminate any means tested benefits.

A basic rate tax payer on a 3% variable rate mortgage would benefit by 1% for any money put into a 5% before tax fixed rate account. That's up to 500 Pounds for 50k for a year. Much less for overpayment money, though because the amounts are lower.

Someone who doesn't mind some risk might like Zopa lending (ties the money up for 3-5 years, repaid gradually, rates of 9%+ after fee and allowance for bad debt currently available, referrer deal available). Or for instant access there are corporate bond funds or gilt bond funds paying more than 5% with a good chance of capital growth as well.

plzhelpmesave!

We fixed back in feb this year and went for the security of a ften year fix (!!) @ 5.39%. We actually remortgaged and took out 15k extra to pay for family stuff, so although we have obviously lost out given current rates, we still think its worth it for us as the Loan To Value rate is now much lower, and we deinately wanted a fixed as it is just hubby working and we coudn;t have taken on any more increases in the rate. We are taking the view that given its over ten years, it will balance out over that time - she says hopefully!

amazamum

I'm on a tracker(for 2 years till next dec) at 0.49% above BOEBR,so my interest has gone from 6.49% to 2.49% in the last year,the only problem I am finding at the moment is that everytime the interest rate goes down I have to go into the bank and get them to reset my mortgage as I want to continue on the same payments just pay off more of the capital.
Not much hassle really.
But like I was saying to my OH they could have gone up rather than down so we took it out at the right time,
I just hope that I can get a decent enough deal when the tracker set period finishes next Dec,but by then if everything stays on track hopefully we will have gone from a 43000 mortgage to about 20000 in 2 years not too bad considering we are both part time.

StuartGMC

plzhelpmesave! wrote: »

We fixed back in feb this year and went for the security of a ften year fix (!!) @ 5.39%.

...we deinately wanted a fixed as it is just hubby working and we coudn;t have taken on any more increases in the rate. We are taking the view that given its over ten years, it will balance out over that time - she says hopefully!

I think your reasoning was spot on at the time, and who knows where rates will be in 2 or 3 yrs from now? Historically, you still have a good rate; we started in 1994 at about 8% which then increased to around 9%, but we had obtained quotes for the typical rate from preceding years of 13%..... to be sure we could afford it (just!).

StuartGMC

amazamum wrote: »

I just hope that I can get a decent enough deal when the tracker set period finishes next Dec,but by then if everything stays on track hopefully we will have gone from a 43000 mortgage to about 20000 in 2 years not too bad considering we are both part time.

Well done on the present rate and your progress on clearing the mortgage. I think however if you only owe £20k then you'll very likely end up on a SVR or similar because you may be below thresholds for some deals and the fees will be a significant proportion of the capital owing. You may want to start looking at the various offers now just to see what minimum they will lend and what fees are being charged.
Good luck

We currently owe £20.5k on a Natwest Offset and although the 4.95% headline rate is not great, there is no value to be gained from moving it. We should be 100% offset in summer 2009 and intend to pay off in Feb 2010 over 9yrs early vs original 25tyr term if our plans hold together.

Lynn11

Redbedhead wrote: »

Thanks. I read it that I couldn't get that because of the savings, so I had better go and have a look at it all again. It is all still new for me with being made redundant this week. I have been focusing on getting a new job more than the benefits side, but I should look in to that asap as well.

If you have not already done so, phone the freephone number and go through the application form, as they fill it in and then make an appointment. If you phone monday, they will process your application but no payments will be made to for mon,tues & wed. it does help having some money coming in when you are seeking employment. I luckily managed to get a job. Good luck to you.

amazamum

Thanks for the advice StuartGMC,what is an SVR(or am I being thick lol).

SmileyG_2

Mycroft wrote: »

Annoyingly, I fixed my rate during the summer for three (count 'em) years. Had I opted for a flexi rate I'd have had a couple of months of pain followed by a wonderful pay-off!

Curses ;-)

Join the "3 years to go on a fixed rate" club!

What's your penalty if you want to jump ship?

SmileyG

continualdiamond

Im in the fixed rate club as well. I have 3 years left on a 5 year deal at 6%.

But im not bothered at all because OH and i were first time buyers 2 years ago and we went for security with matching as close as possible our monthly payment to what we were paying in rent.

Im greatful we did as OH was outta work this year for 6mths and knowing our mortgage payment wasn't going to change was a huge help. It was one less thing to worry about.

StuartGMC

amazamum wrote: »

Thanks for the advice StuartGMC,what is an SVR(or am I being thick lol).

Sorry, we tend to drop into too many TLAs...

SVR is Standard Variable Rate; basically the standard rate offered for mortgages without tie-in etc.

HTH
(Hope That Helps )