Remortage - Worth Offsetting?

wackojackouk

Hi guys

Wonder if anyone can offer some advice on a possible remortgage.

Our fixed rate is due to end mid May. We are currently with Abbey @ 5.19% with 20 years left. Mortgage was originally £150k on a £170k house back in 2004.

Upto Jan this year we owed £135k. Not 100% sure what the value is now although there are a couple of 2 bedroom houses down the next road to us up for £185k and a 3 bed down our road for £240k :eek: (our house is originally a three bed but now a 2 bed although we are going to reconvert it back). I think £240k is unrealistic but possibly nearer £185-£200k.

Anyway...... my OH is currently on Maternity Leave and due to go back to work in May but is also pregnant again and going to be off from September onwards so in effect I am paying the mortgage (roughly £890 per month at the moment plus bills = £1400 per month).

I am working on a contract basis at the moment due to being made redundant last Sept and my contract runs out in July (no idea about extension etc).

I also have about £30-£35k in savings, isas etc.

Basically I am wondering whether we should consider an offset mortgage such as First Direct 2.99% fixed for 2 years or not? (work situation, OH not working etc) as the savings rates are pretty !!!! at the moment.

The other option perhaps is a 5 year fixed rate (not sure of rate but around 4% - 4.5% hopefully after latest cut) as the missus is unlikely to go back to work once the nippers (twins) are here in October.

Failing that we can just let it go to the SVR which I believe will be 4.29% after 1st April with Abbey and go from there.

Your thoughts on what my best options might be would be very much appreciated

Ta

WJUK

whu

Hi - IMO you should look for the best rate available irrespective of whether it is an offset or not because in your circumstances you may need to dip into your savings depending on your job situation and if you do the offset won't be as valuable unless it is a better rate / as good a rate as a non offset product

wackojackouk

Thanks WHU

I guess the offset might be better for me at this stage then as FD are 2.99% fixed for 2 years whereas Abbey are 4.29% SVR. I think even if we went for a 2 year fix with Abbey it's over 4%

I think if we could get a 5 year fix for under 4% we'd go with that which would mean we could dip into savings if need be.

Hopefully sort out a full time job soon as this obviously puts more doubts in my mind.

Ta

WJUK

wackojackouk

Any other advice ppl?

dimbo61

Post Office do a 5 year fix for 4.15% LTV 75% fee £799
A&L do a 5 year fix for 3.99% with no fees ! BUT LTV max 65% !!!
Consider long term fix as OH may be off work for a few years with twins !!!
use savings to bring down LTV if needed GOOD LUCK