C&G fee free fixed deal at end of current deal - advice

Thrugelmir

mpazza wrote: »

Thats true but the worry is C&G has the lowest SVR and if LLoyds sell them off or pay the goverment back that could suddenly rise irespective of base rate?

If and when that occurs remortgage elsewhere.

Focus on what you can influence not matters that are outside of your control. Base rates in the longer term will increase across the board. So the better the LTV you have the better the available rates.

As for Lloyds the its HBOS part of the Group which is in trouble not the pre merger Lloyds Bank which has remained highly profitable even in the recession.

ah7386

I was offered this deal before they sent the letters out.
As I have around 80% LTV and £160,000 mortgage I was worried about where to turn when my current deal (4.99%) ends in December. Yes the SVR looks attractive now, but if the rate does start to rise, with such a high LTV my options for a fixed rate are already slim - they could be non existent in a few months time.

Needless to say I personally jumped at the offer especially as there was no fee to pay. I would have loved to fix for longer but atleast im secure for another 2 years and hopefully my LTV will start to look a little healthier.

Thrugelmir

ah7386 wrote: »

I was offered this deal before they sent the letters out.
As I have around 80% LTV and £160,000 mortgage I was worried about where to turn when my current deal (4.99%) ends in December. Yes the SVR looks attractive now, but if the rate does start to rise, with such a high LTV my options for a fixed rate are already slim - they could be non existent in a few months time.

Needless to say I personally jumped at the offer especially as there was no fee to pay. I would have loved to fix for longer but atleast im secure for another 2 years and hopefully my LTV will start to look a little healthier.

If had taken the SVR option and maintained your mortgage repayments. You would currently be repaying over £260pm of additional capital per month off your mortgage.

Just said as an observation, not a criticism. As many people are happier knowing what there outgoings are fixed.

mpazza

Thrugelmir wrote: »

If had taken the SVR option and maintained your mortgage repayments. You would currently be repaying over £260pm of additional capital per month off your mortgage.

Just said as an observation, not a criticism. As many people are happier knowing what there outgoings are fixed.

I think I'm incling to your advice now it would be good to start paying some of the capital off as C&G do let you overpay up to 10% and later underpay if needed.

gundo

I'm in the same situation come April and the SVR of 2.5% sounds great. I'll leave my payments as they are and over pay to finish the mortgage off early. Since the fixed period will have ended to my mind if the SVR does go up then I'll simply remortgage (with no early redemption to worry about) to a fixed at that point. It's been galling paying 5.49% interest whilst all my friends on trackers etc. have been boasting about how their mortgage payments have gone down.

Roll on April and fingers crossed the SVR stays low for a while so I can enjoy overpayments.

opinions4u

I'd go on to the 2.5% rate, pretend my rate was still 5.29% and overpay by the difference. You know the potential risks of rate rises, but it would take a 3% rise to affect you negatively against your current position. I don't see this happening in the next 2 years.

Thrugelmir wrote: »

As for Lloyds the its HBOS part of the Group which is in trouble not the pre merger Lloyds Bank which has remained highly profitable even in the recession.

I suspect LTSB retail still makes them money, but can you confirm that the £3bn of losses not attributed to HBOS Corporate aren't hidden somewhere in the old LTSB lending books?

Rob71

Like the others have said: stick on the SVR for now.

Two years is incredibly short for a rate that is considerably higher than your SVR - like they've said, overpay so that you continue to budget as if you were on the higher rate - that'll help drop your capital, which in turn will help you get a better rate when it's a good time to fix.

Do you fix the first time the rate rises? No.

The banks will capitalise on the fact customers will be falling over themselves to pay reservation fees and the rates won't be competitive. Wait for the gold rush to subside, then fix - you'll get something similar to what you have now within the next two/three years - it almost certainly won't be more.

In the meantime, make hay whilst the sun shines and reduce your LTV/pay off your capital.

I'm no mortgage expert, but I've recently gone through a similar process and did a fair amount of research. 2.5% will take some beating, and there's no telling what rates/fixes you'll be offered in the next year or so.

Thrugelmir

opinions4u wrote: »

I suspect LTSB retail still makes them money, but can you confirm that the £3bn of losses not attributed to HBOS Corporate aren't hidden somewhere in the old LTSB lending books?

I'm in no way advocating buying the shares at this point in time. As the economic recovery has some way to go, so events could still dip up and down.

Taking the 6 months to 30th June 2009. LloydsHBOS lost £4 billion pounds.

Lloyds made £6 billion.
HBOS lost £10 billion.

However within the figures are £13 billion of impairment charges against possible losses on HBOS's loan book. So although bad the ship isn't sinking.

Lloyds is making a great play of the cost savings by amalgamating the businesses. To 30th June 09 around £100 million. By end of 2011 on target to save £1.5 billion a year.

So although a long road ahead, going bust is unlikely.

opinions4u

Lloyds made £6 billion.
HBOS lost £10 billion.

The £10bn was attributed to HBOS Corporate.

The £6bn was from the rest of the group. I would think that HBOS Retail and LTSB Retail probably contributed similar levels of profit between them. No idea about Lloyds Wholesale contribution though.