Remortgage advice please

SHEILA54

Hi

I have a mortgage with the Chelsea with another 8 years to run.

At present I am tied into a fixed rate of 6.49% for another 35 months with 5% redemption penalty.

The outstanding amount is £72274.27 with £3604.74 redemption penalty & £175 exit fees.

I also would like to add around £4000 for repairs and cc bill.

Looking at the ditch or fix it appears that I may be able to save money or maybe pay the same, including the extras?

Any advice would be appreciated and I would prefer low set up costs as I do not have any savings.

My annual income is £29,000 and the house is worth around £390,000.

Many thanks for any advice

herbiesjp

On the basics, it looks straightforward

However you would need to see if it does all work out in your favour once the penlaties and costs are taken into account

Best bet is to talk to a whole of market adviser who could look at direct only deals as well as broker deals

ben37564

My opinion is that in order for a remortgage to be cost effective, what you save interest must be greater than the cost to do so.

The fact that you have a 5% redemption charge means that it would be highly unlikely that you'll find another deal that will save you over £3779.75 over 35 months.

Your first port of call should be the Chelsea. Ask them about your need for £4,000 additional borrowing and see what they can do. Usually there's a minimum amount you have to borrow but some allow you to borrow say £10,000 and then pay back £6,000 on the same day (strange I know but quite effective for small loans).

Only once your fixed rate and therefore you redemption charge has expired should you think about a remortgage.