Advice on changing mortgage and reducing term

powelso

Hi everyone,

Can anyone give me some advice please. We currently have a mortgage of £104,000 fixed on a 2 year deal (1 year left to go) at 5.79%. our redemption fee is 3% and the total term left on this is 23 years.

I'm considering changing to a 5 year fixed rate of 3.99% as this will allow us to reduce the term left to 18 years and pay roughly the same amount each month.

We need the stability of a fixed monthly payment and I know that we probably won't save over the next year if we changed but surely there would be a saving overall as we will be reducing the term?

thanks

_Andy_

Why not just reduce the term of the existing mortgage?

powelso

we can't afford to pay any more than about £700 a month and reducing the term at 5.79 will push us way over that.

Anon

powelso wrote: »

Hi everyone,

Can anyone give me some advice please. We currently have a mortgage of £104,000 fixed on a 2 year deal (1 year left to go) at 5.79%. our redemption fee is 3% and the total term left on this is 23 years.

I'm considering changing to a 5 year fixed rate of 3.99% as this will allow us to reduce the term left to 18 years and pay roughly the same amount each month.

We need the stability of a fixed monthly payment and I know that we probably won't save over the next year if we changed but surely there would be a saving overall as we will be reducing the term?

thanks

Considering you will also have over £3120 redemption fee, plus any arrangement fees on top of that. As you have only one year left of the current fix, you are unlikely to be able to recover that?

Anon