wait for fixed term to end?

geet

I have a mortgage of £131,000 for approx 19 years - paying £989 pm at 6.15% fixed for two years expiring only October 2009. Early repayment charge is approx £1200.

Is there anything I can do considering interest rates are very low now? Or should I just wait till October? If so, what kind of interest rate should I be looking at and is it advisable to go for fixed rate or tracker then?

Thanks in advance.

dimbo61

We are now in March and even if you found a new better deal by the time you have sorted out the paperwork and had a survey, solictors,credit checks etc you would more than likely have paid the mortgage in April so why pay £1200 for 6/7 months of mortgage payments and could you save £200/250 a month ?
What does your existing mortgage deal revert to after the fix ends ?
If its a tracker deal at say BOE plus 0.75% then it would pay you to do NOTHING as your mortgage will go down!
If you need the security of a long term fix and we dont know your income,credit record, LTV, deposit,age ETC you need to check whats available about 3 months before your deal ends !
So start looking about July/august but check your mortgage details first
( please ignore the part "this mortgage reverts to the SVR CURRENTLY 99% in 2006 ! ") and check what your lenders current SVR is OK

geet

Thanks for this, yes, I suppose it makes sense to keep quiet and not feel bad when all friends say their mortgage has come down! Yes, the deal says SVR standing at 7.75%. Will check what it is around July.

Mortgage is in husband's name - I am the money manager:-) So, income is 40K, credit record is ok, age 44, deposit would be about 68K, if prices keep crashing not sure.... Want to reduce period to 16 yrs to finish mortgage at his 60.

So in principle, is SVR better than fixed rate as interest rates are coming down and also is it better to stick on to same mortgage as everyone is charging around 995 as fee?

Thanks.

dimbo61

You dont mention your lender ?
What deals they have and if you want another fix for security !
Rates have never been this low and if you got a long term fix of 5/7/10 years at less than 5% you would have security for a long time and be paying less than you are right now !
The size of deposit / value of your home is important only when you are looking at the LTV of the mortgage and offers available to you IE 60% and less,75% 85% 95%
I would get the best deal possible and overpay the money saved ( cheaper deal ! ) to clear the mortgage ASAP
A £995 fee is only £200 a year over 5 years ( better still pay cash for the fee )
Use " whatsthecost " to check what deals would cost you
EG 5 year deal at 4.99% for £131,000 over 14 years works out at £1085 a month.
I like fixed deals and offset mortgages but thats me ( this is only my opinion )
GOOD LUCK

dimbo61

HSBC have a 5 year fix at 3.99% fee £995 but its only for existing customers and LTV below 60% !!!!

geet

We are with Abbey. The other constraint is that we cannot afford more than £1000 a month to pay mortgage:-(

Checked the whatsthecost. So, it looks like even with a maximum 2% decrease in interest rate if we go for reducing two years of repayment period then we are going to be paying around same amount every month. Good to know that.

Under 5% for a 5-10 year deal is a good starting point - thanks!

sandspider2000

dimbo61 wrote: »

HSBC have a 5 year fix at 3.99% fee £995 but its only for existing customers and LTV below 60% !!!!

This deal isn't only for existing HSBC customers. I've just applied for this mortgage and been approved in principle, and I've never used them for anything before. (As far as I'm aware!). 60% LTV is right though.

koexelek

sandspider2000 wrote: »

This deal isn't only for existing HSBC customers. I've just applied for this mortgage and been approved in principle, and I've never used them for anything before. (As far as I'm aware!). 60% LTV is right though.

Be interesting to see what sort of service you get.

I advised a client of mine to go to HSBC direct last Monday, as they had the best deal.

She came back to me on Thursday saying that she was getting nowhere, and could I get her the next best deal instead :beer:

sandspider2000

Well, so far I've had no problems. Quick to contact me and to return my calls etc and always managed to get through on the phone. Fingers crossed!

dimbo61

Sandspider2000 I stand corrected
If you have less than 60% LTV its a very good deal then "geet"
£131,000 fixed at 3.99% is £1018 a month over 5 years ( 14 years term ! )
So £30 more expensive each month but you reduce the term by 5 years !
Fee £995 and 20% overpayment each month allowed

sandspider2000

:-)

The only problem that I see with this mortgage is that as dimbo says, you can only overpay monthly by direct debit. No lump sum payments. Also, there are no payment holidays available.