5 Year Fixed

jammo1982

I took out a £90,000 mortage last year, fixed for five years at around 5.89% (payments of around £595), over 25 years. The property is worth £115,00 and I put down a £25,000 deposit.

I have two questions that I was wondering if people could help me with.

1) Would it be worthwhile re-mortgaging right now to get a tracker mortgage to take advantage of interest rates? I know there are a lot of variables but if anyone could point out the circumstances in which it would be advisable to would be much appreciated.

2) I am thinking of moving in two years to a more expensive property, around £150,000 and thus want to know what would be the best course of action for dealing with the fact I am in a 5 year fixed mortgage with my bank? Again I know there a lot of variables but if anyone could advise various options it would be much appreciated.

Many thanks

beecher

How much is your Early Repayment Charge? You need to work out how much you'd save per month by moving to a tracker (and remember most are 2% or so above the base rate), factoring in the ERC and any arrangment fees you need to make. Then you can do the sums.

As for your second query, is your mortgage portable? If so you'd be able to move it, depending on whether you met the lending conditions at the time, ie LTV etc, and take out a mortgage for the remaining amount too.

_Andy_

1) Please see the numerous other threads on the same subject.

2) If your mortgage is portable you would be able to move it to the new property as long as you still meet the lenders criteria.

jammo1982

1) Cool its just a case of finding out the ERC and arrangement fee and working it out against how much I would save.

2)I think it is portable. How would it work for the extra amount I want to borrow (£35,000) if I met the lending criteria?

Thanks for the posts guys

_Andy_

jammo1982 wrote: »

1) Cool its just a case of finding out the ERC and arrangement fee and working it out against how much I would save.

2)I think it is portable. How would it work for the extra amount I want to borrow (£35,000) if I met the lending criteria?

Thanks for the posts guys

1) You also need to bear in mind the impact to your mortgage balance. I.e. yes you may find a monthly saving but your balance is immediately going to be significantly larger.

2) The same as if you weren't borrowing more. I.e. they'd effectively treat it as a new application in any case.