Is it worth leaving NR for new lender ?

sconieroany

Hi all, I have 36K outstanding mortgage with Northern Rock, even though the property is worth 250K I got stock with the asset management (bad bank), which I thought was odd, anyway, my fixed term ends in six weeks time, so I was wondering if I should move to another lender, to get away from NR asset management.

I will revert to the NR variable discount rate for long term customers of around 4.7%, however I overpay around £700 pm (£1000 payment), so at todays rates, I would be mortgage free in 3 & 1/2 years or so.

I do like the flexibility of being able to pay more and draw down on those overpayments if required, so if I did move I would like flexibility.

Would it still be worthwhile moving to a new lender given my estimated mortgage Free timescale, and if so, I presume it will also have to be a "Cost Free" set up fee, as it would need a tiny rate to make up for a £1000 or so set up fee.

Thanks

getmore4less

Why not do the numbers against the FD tracker or offset tracker with no arrangment fees.

With the fees(there will still be some) the lower rates may make it worth while, with the offset there is the extra flexability so that might be worth it.

Quick numbers
NR £36k 4.7% £1000pm 39months last payment £882
FD £36k 2.59% £1000pm 38months last payment £517

So a saving overall of around £1370.

If you can keep the fees down it would be worth it.

They may want you to have a longer term than 3-4 years but thats OK if you offset.

sconieroany

Thanks for the reply, neved had an offset mortgage, so I'll look into this, so you think that I could sign up for a ten year term with FD, then by continualy building up my savings/offsetting, I could still have a small saving as you indicated, but also more flexibility that NR asset management can now offer.

Cheers