Mortgage - can't decide between lenders and haggling ?

needahol

Hi

After spending about 3 days trying to decide what type of mortgage to go for and which lender, I've found what I think is the best deal

In a nutshell, I'm buying a property for £150k and putting down £100k so need a £50k mortgage. I had decided to go for a tracker mortgage at 2.59% above base rate. There is no arrangement fee with this, I'll get a free valuation done and £250 cashback. I'll be tied in for 3 years and will go onto SVR afterwards.

However, I've just noticed that my bank currently has a rate of 2.49% above base rate, which I'd only be tied into for 2 years BUT there's no cashback (which I'm not that bothered about) and I'd have to pay for a valuation (around £300). I will have the option to keep the 2.49% above base rate after the 2 years is up.

The difference in monthly payments is around £2.60 (obviously based on current rates) so I would be unlikely to recoup the valuation or cashback over a 3 year period.

My question is a) Will my bank have any discretion to pay the valuation fee for me and therefore get my business or will I make myself look stupid even asking?

b) If the above is not heard of, would it be better to take my mortgage via my bank anyway due to the tie in being 2 years as opposed to 3?

I'm assuming it would be much easier to arrange a mortgage with my bank as they'll have all my income and other details to hand.

If anyone has any advice to offer, I'd appreciate it.

Cannon_Fodder

What is the ERC? Pick the one with the lowest, you are likely to use it.

needahol

Cannon_Fodder wrote: »

What is the ERC? Pick the one with the lowest, you are likely to use it.

Thanks for your reply, it's 2% with first lender, 1% with my bank.

Can you explain why I am likely to use it?

[Deleted User]

I think that what Cannon Fodder is suggesting is that interest rates might revert to their "norm" of 5-6% or even higher during the term of your tracker. At a base rate of 5%, you would be paying 7.5% on your mortgage which will seem very expensive indeed compared to your starter rate.
Personally, I don't think this will happen but the current outlook is more unpredictable than it has been for years so I would be inclined to hope for the best but prepare for the worst.

getmore4less

Whats wrong with the FD offset life time tracker
base +1.98% with a £999 fee
base +2.39% with no fee.

these might not be the best but better than those you have picked so far.

Dan_1976

Rates willl be higher, prob from next year so think about your budget. Its not a big mortgage compared the average but we dont know your income etc.

Banks wont haggle, they will make little from £50k.

ultramagnetic_commuter

Although it's not what you're asking, I must admit to agreeing with Cannon Fodder's sentiment. I think the banks are luring people into attractive BOE trackers because general perceptions are rates will rise. I predict that in 2 years there will be a lot of people complaining about the trackers they're tied into (just like the people complaining they're tied into high fixes now).

I offset my risk with a capped tracker but will still take a hit if rates get high.

needahol

getmore4less wrote: »

Whats wrong with the FD offset life time tracker
base +1.98% with a £999 fee
base +2.39% with no fee.

these might not be the best but better than those you have picked so far.

Thanks, have looked at this but it's interest only - the others are interest and capital, which is what I wanted.

Thanks to all who have responded.:beer:

VIGILANT22

ultramagnetic_commuter wrote: »

Although it's not what you're asking, I must admit to agreeing with Cannon Fodder's sentiment. I think the banks are luring people into attractive BOE trackers because general perceptions are rates will rise. I predict that in 2 years there will be a lot of people complaining about the trackers they're tied into (just like the people complaining they're tied into high fixes now).

I offset my risk with a capped tracker but will still take a hit if rates get high.

So so true....people are very short sighted and only think of the here and now....for example one lender is only offering trackers on BTL's...why?.....but people never stop to think!!....

somethingcorporate

needahol wrote: »

Thanks, have looked at this but it's interest only - the others are interest and capital, which is what I wanted.

Thanks to all who have responded.:beer:

You can just put the capital part in to the offset account!