6% and tied in until 2017

DR_Paul

Hi Folks

My wife and I paniked at the state of the economy a couple of years ago and agreed to a 6% fixed rate mortgage untill 2017. I contacted Nationwide to try to negotiate it down and got a bloodied nose on a brick wall.

In short we can cancel at a fee of £4532. If we do this and secure 4% elsewhere we would save £323 x 60 months = £19,380. Paying Nationwide £4532 to do this hurts. Any suggestions.

Paul

beecher2

Look at your documents to see if the ERC comes down on the anniversary of when you took out the mortgage. You have no way of avoiding paying the ERC so other than that I have no suggestions.

Senior_Paper_Monitor

I make that 84 months - even based on January 2017 - rather than 60 months BUT I doubt you will find a 4% fixed over either period (even if you have very low LTV) - long term fixes are being calculated on the basis of forecast rate rises.

However, a shorter term deal (preferably overpaying to the level of your current payments) may still make sense - but there is an element of gamble to it as the replacement/SVR may well be back in 6% or worse ..... your call !

Wakey2008

6% may sound like a high rate now but if rates where to rise then it could very quickly become a very good rate indeed.

The rates around 4% at the moment tend to be variable products and you need to think about rates rising (which is very likely).

The lowest five year fixed I can see at the moment is HSBC and that's at 4.73% with a £999 non-refundable fee and the max ltv is 60%.

property.advert

DR_Paul wrote: »

Hi Folks

My wife and I paniked at the state of the economy a couple of years ago and agreed to a 6% fixed rate mortgage untill 2017. I contacted Nationwide to try to negotiate it down and got a bloodied nose on a brick wall.

In short we can cancel at a fee of £4532. If we do this and secure 4% elsewhere we would save £323 x 60 months = £19,380. Paying Nationwide £4532 to do this hurts. Any suggestions.

Paul

Pay the money, go on variable then decide whether to fix later. Your costs are covered in year 1 savings.

dimbo61

Who said the OP could go onto the variable rate from Nationwide ?
What if they say no thanks !
Whats more important is the LTV and deposit paid, current value of the property and both incomes ( bearing in mind the NEW lending limits !!!)
You have long term security and if you can overpay every month ( check limits !!)
Do Nationwide allow £500 a month OP?

DR_Paul

Hi

Yes Nationwide do allow £500 OP per month

DR_Paul

Hi

Yes Nationwide do allow £500 OP per month

getmore4less

What were you paniking about at the time and what has changed?

Try to think about what you want can afford before paniking into another deal.

JoolzS

If you can afford your current mortgage payments - stop worrying. You may be paying more than you would be if you'd secured a mortgage at the current interest rate - but would you have qualified at this rate, and would your property be available at the price you paid?

If you can't afford your mortgage then I have no advice (other than you shouldn't have bought a property). If you can afford your mortgage then stop beating yourself up about interest rates and try to enjoy your home.

Stop thinking about your home as property and think of it as home. I've lived in my "property" since 1993. I always assumed that DH and I would sell and move on within a few years but that didn't happen - and now it really is home. It's too small, doesn't have a garage or a decent garden - but it's home. A bazillion people in the world don't have homes - I feel lucky to have one, even though we still have a hefty mortgage to pay off.

Julie