New deal or stay on SVR?

boybeck

My Nationwide repayment mortage is £40,000.

I'm making overpayments every month and plan to have it paid off by February 2009.

My tracker (4.69%) ends in February 2007 and I will then go onto the Nationwide's standard variable rate (5.89%).

Current monthly payment: £349.72 plus £500 overpayment.

I also plan to make two lump sum overpayments between now and February '09.

Do you think it's worth going for another tracker deal with the Nationwide when the reservation fee is £499? or shall I just stay on the SVR for the remaining duration of the mortgage.

My maths isn't the best, but am I right in thinking the reservation fee cancels out any savings I'd make?

Cheers

Jason

jamesd

In the market today you could probably obtain a rate 1% below the SVR, leading to a reduced interest payment on 40,000 for one year of 400. It's likely that you could save more than 499 by switching, how much depends on the rates and costs involved.

You should also consider non-Nationwide providers. One of the no fees deals may be your best option, since the fees will be a fair bit of your total cost at the repayment schedule you're planning. Also remember the mortgage termination costs if you did switch provider - those may be significant.

Joe_Bloggs

Your savings may also be a factor if they are significant when compared to the mortgage and taxed. An offset mortgage might be worth considering. Ask the Nationwide why they do not provide one when YBS can.
J_B.

regularsaver1

Not every lender offers offset and i've not found out why either. Halifax do not either

Joe_Bloggs

Nationwide BMR (AKA SVR) will go up by 0.35% from Sept 1st. This might tip the balance into doing something else.
J_B.