Early repayment charge

beecher

I'm not sure what help you want, other than what has already been posted.

andys15

Its the fact that if I did change mortgage, I would save £700 per month on interest, I would pay £220 extra on capital per month, so that is £920 per month saved. I would also have an extra £420 per month extra which would pay the early repayment charge. If and I know its a big if, the boe remains at 0.5 for 12 months. I would have saved £8400 in interest, paid an extra £2640 of my capital and paid £5040 towards the £6800 ERC. Yes a gamble but over the next 12 months would interest rates go up by so much. I am trying work out the interest rate the boe rate would have to rise to which would make me break even.
As I am close if not already in negative equity if the interest rates dont rise to much in the next 23 months then it has paid off because come 23 months time, I will have to be on the boe rate plus 1.49% anyway, as I wont have the LTV to get another mortgage deal.

beecher

You'd have paid an extra £2640 off your capital but still owe £1760 on your ERC, and that's without taking into consideration the interest due, or the likelihood of base rate changes. I just don't see the logic. Overpay your mortgage instead and focus on that.

Does your fixed rate end in 23 months time? If so it is even crazier to be in a position where you might break even after 16 months! Concentrate on overpaying your mortgage rather than getting into debt to get out of your deal.

andys15

yes only 23 months left. its the £8400 of interest saved in a year that is screwing with my mind.

SouthCoast

andys15 wrote: »

I sell my first house in 1999 just before the boom starts, I buy my next house in 2008 just as the house prices starts to crash. I get offered a tracker deal in JUN 08 of .29 above the BOE rate, and I decline because I always felt fixed rates gave me peace of mind. I now want to pay £6767 TO SAVE £420 a month, knowing my luck the BOE rate will be a 7% within 16 months.. I am a S*** Magnet

I know of folks who are still paying for properties that were repoed in the 1990's who are now facing repo again.

andys15

Yes, sorry I was just on a bit of a moan before and others are going through so much worse.