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To switch or not to switch
no1gymbunny
Posts: 391 Forumite
My Dad and I have got an interest only joint mortgage with Bristol & West. The 2 year fixed rate ends this month. We're currently paying £759. It'll now go onto the standard variable which is currently 2.99% which means the payment will go down to about £350.
Dad wants us to continue paying what we've been paying to try and pay it off quicker which is fine. I spoke to B&W today to see if that's possible. They said not with this product basically. Every time we 'over-pay' we'll incur a £50 fee. So, we could save up all the 'extra' and pay it once a year or something and pay £50 or they said we could convert it to an interest & capital mortgage and the monthly payment at the moment would be £623. Apparently, if we feel that that the variable rate is going too high for us, we can switch back. BUT every time we switch from one to the other it'll costs us £50.
Which is the better option?
Dad wants us to continue paying what we've been paying to try and pay it off quicker which is fine. I spoke to B&W today to see if that's possible. They said not with this product basically. Every time we 'over-pay' we'll incur a £50 fee. So, we could save up all the 'extra' and pay it once a year or something and pay £50 or they said we could convert it to an interest & capital mortgage and the monthly payment at the moment would be £623. Apparently, if we feel that that the variable rate is going too high for us, we can switch back. BUT every time we switch from one to the other it'll costs us £50.
Which is the better option?
Getting older is inevitable, growing up is optional :rotfl:
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Comments
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How are you planning to pay off the capital eventually, ie do you have a repayment vehicle in place?
Foreversummer0 -
LOL. B&W r sh....
Gym bunny. Apart from how are you going to pay back the mortgage. I believe the advisor might have told you porkies. On the standard variable rate you should be able to overpay.
Check on this unless the have a special clause on it.Motto: 'If you don't ask, you don't get!!'
Remember to say thank you to people who help you out!
Also, thank you to people who help me out.0 -
We don't have a repayment vehicle in place. Was planning to just switch to a capital mortgage in a few years time - probably not the best idea.
The guy definitely said we'd incur a £50 fee or 'penalty' every time we over-pay, whether it be every month or once a year.Getting older is inevitable, growing up is optional :rotfl:0 -
I think I'm going to switch. The rate is currently 2.99% which I know is really low. How do I work out what it'll cost each month if the rate goes up? At 2.99% it'll be about £625, which is great, but sadly, that won't last!Getting older is inevitable, growing up is optional :rotfl:0
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Use "whatsthecost" website and put in your mortgage balance and how many years you want the mortgage over, then put in 2.99%/3.99%/4.99%/5.99%/6.99%
No chance you might get a fixed rate repayment deal with your existing lender just for security !!
GOOD LUCK0
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