Hi - I posted this on mortgages and endowments but nobody has replied so Im not sure If I posted it in the wrong place so Im trying it here to see if I get any advice :)


Hello - here I am again on another thread asking for more money saving advice. Ive managed to save money on my electric & gas, bulidings & contents insurance and my home phone bill so I decided to phone up my mortgage provider and ask them for a mortgage review. My mortgage is for £54500.00 with 10 years to run. I am on an interest only option as I have an endowment so I pay £295.10 per month for my mortgage ( think the interest rate is 6.49% ). I have never missed a payment or had any arrears. I have been offered a few different fixed rates with differing lengths of fixation - listed below.

2yr fix - 4.69% = £210.00 per month
5yr fix - 4.99% = £224.00 per month
10yr fix - 4.95% = £222.00 per month

I would be charged £545.00 early redemption fee for redeeming my current mortgage if I took up any of these offers.

There would be a cost of approx £1000.00 for moving the mortgage but they would refund this fee. I would be tied in if I accepted this refund for 3 1/2 years although I could move house and move the mortgage with me without any further penatlies.

On the new fixed rates the interest would be worked out daily and not annually as it is a present. I could also make extra payments as long as I dont pay it off in full before the fix term ends.

In the future I would like to start paying off my mortgage and not depend on my endowment. Looking at the above fixed terms and fees I am favouring the 5 year one as if I took the 2 year one I would still be tied in for 3 1/2 years for the refund of costs. If I took the 5 year one I would save £71.10 per month on the current interest rate charged so it would take me 7 1/2 months to pay off the fees for early redemption before I would start to make any savings ( excluding any overpayment I may make which will probably not be for a few more months ).

Sorry for yet another ramble on but I would value the advice from others on here with more experience in these matters.

Many thanks for everybodys kind support and advice
:cool: Official DFW Nerd Club Member #37 Debt free Feb 07 :cool:
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