Mortgage help

ZoeS_2

Hi

Right here goes....

I have a capital repayment mortgage. There are 2 parts to my mortgage, both with 'halifax', as i moved house and borrowed additional money. They are therefore running on separate rates, etc. The initial mortgage of £99k came out of it's fixed rate (4%) last summer. I was on maternity leave so felt it most sensible to take a fixed rate for 3 years at a rate of 5.99% with Halifax. I also have a further mortgage of £68K on a lower rate of 5.14%, which is due to come to an end in july.

I am totally confused as i am paying £987 per month for the whole lot and am losing money every month. If I come out of the £99K mortgage it will cost me £3000 penalty or £2000 if I come out after October. I will also have a fee if I take out the £68K now instead of leaving it to end in July.

My dilema is this...
a) do I leave everything and in July put the £68k into a tracker for 2 years then I can combine the whole lot when the £99k comes out 2 years later
or
b) do i pull it all out now - pay the penalty and hope the money we save each month will eventually offset the penalty!
or
c) when the £68k comes out in july I pull out the £99k and pay the penalty and combine the 2 sums of money on a tracker - again hoping the interest rates stay low enough for me to recoup the penalty

My other dilema is.... if they keep running at different times i will have to pay admin fees (£999) with the halifax each time the morgage comes to and end. i paid £999 last year and will have to pay it again this year!!

I hope this makes sense...any advice you can give or any suggestions would be great!

We have ended up paying an extra £150pm since the £99k moved onto the higher interest rate (was 4% before) and I have been on mat leave so have been living off savings. This has equated to an extra £1500 over the course of my time off resulting in our savings dwindling down to nothing.

Due to the increase in our council tax, mortgage, gas and electricity I now have to return to work 4 days per week instead of 3, which is what i initially hoped to do! These things happen but if i can save money anywhere it will make our lives a lot easier!

thanks

Trying_to_be_good

The easiest thing is normally to let one of the mortgage parts revert to SVR (there will be no fee), until the second part ends, then you can re-mortgage the whole lot together as one, paying only one fee for the combined mortgage.

This won't help you in the meantime, though, and you could go over to the DFW thread, post your statement of affairs and see if there's anywhere to save some of your outgoings.

On the mortgage front, you could see if you could extend the term of either (or both) parts of the mortgage if you're on repayment, or try converting some to interest only.

Well done on having some savings going into this - you'll want to replace them for the next 'emergency' when your situation allows.

JayZed

I agree, let one go onto the SVR in July - SVR rates are dirt cheap at the moment, even more so after today, so that will save you a bit of money on that portion of the mortgage.

However, you won't necessarily want to leave it on the SVR until 2011 - interest rates won't stay low for ever.

Floxxie

If you pop your query onto the mortgage board there are a lot of mortgage advisers who can give you some direction.

Floxxie