Looking for new mortgage deal - advice needed

gill_81uk

Apologies for a lot of waffle but I'm pretty clueless with these things. I'm looking for some advice regarding a new mortgage deal. We have paid off just over 20% of current mortgage. We are expecting our first child and will need to move house when we are ready for another so we need a fixed for 2/3 years then a reasonable rate until we are ready to move.

We are have been with The Chelsea for the last 4 y

ears (2 fixed 2 year periods, this was our first mortgage) We were going to resign up with The Chelsea but were disappointed to discover that the arrangement fee has gone up to £995 from £395 only a couple of months ago.

The offer we could sign up for is 2 year fixed, 4.39 then reverts to 5.79 (standard variable rate) with fee of £995. The main things that concern me with this are the high arrangement fee and the high rate after the 2 year fixed period.

I have been looking into the Postoffice 3 year fixed/fixed assisted which is fixed at either 4.39 or 4.59 which then goes to base rate +1.99%, currently 2.49% The arrangement fee is £599 but I am confused by a bit at the bottom which says

Higher Lending Charge paid by lender for 80% LTV mortgages. No Higher Lending Charge for 60% LTV mortgages. Lending Fee: £195 (due on completion but repayment can be deferred until the mortgage is fully repaid). Full repayment mortgage release fee (currently £0). Borrowers must be 18 or over unless stated. Rates correct as at 02/12/2009. Free legals for remortgages: If your product is described as 'No legal fees (for remortgagers only)' we will pay the fees for remortgages only via our nominated solicitors. Terms and conditions apply, please see our General Lending Criteria.

Does this mean that we pay £195 on top of the £599 and does this look like a suitable deal given our current circumstances? Being 21 weeks pregnant my current priority is to find the best deal that I can with minimum hassle and stress, priority being as little stress as possible rather than as cheap as possible.

Cannon_Fodder

Fix for longer. Handing over £500 to £995 every 2 years is like taking on a 1% more expensive deal.

3yrs is better than 2, but shopping around for a 5yr fix that either has no early repayment charge or is portable, would be even better.