+0.79 Tracker - will it ever make sense to move lender?

sequin123

Hi

We have a £147k mortgage on a lifetime tracker @+0.79 BOE base rate. This was a rate that we got when we remortgaged in 2008

We are looking to borrow an additional 80K for a house move,
we have shopped around and our lender (HSBC) is not offering the most competitive rates for our 75% LTV but I cannot see that it would make sense to move because the majority of the mortgage is at the lifetime tracker.

What I am trying to figure out in my head is will it ever be worth moving our mortgage to another lender as we will never get a rate anywhere near that if we do.? So could we end up staying with them for the remainder of the mortgage as it will never make financial sense to move or am I missing something here?

Thanks

jamesperrett

I suspect that mortgage rates will return to more normal levels over the next few years and deals like yours will start to appear again.

While the rates are low make sure that you use the extra cash that you save on the mortgage wisely. The best thing to do would be to put it into a high interest savings account now so that you can pay some more money off the mortgage when rates go up again.

James.

getmore4less

jamesperrett wrote: »

I suspect that mortgage rates will return to more normal levels over the next few years and deals like yours will start to appear again.

While the rates are low make sure that you use the extra cash that you save on the mortgage wisely. The best thing to do would be to put it into a high interest savings account now so that you can pay some more money off the mortgage when rates go up again.

James.

I think we will see fixed and SVR move back to smaller differentials(2%) over base as base rate rises BUT not base rate trackers these will keep a premium over 1% or collars will get put on them next time round if they narrow too much.

Those with base rate trackers(+little) hang on and overpay


OP - what do HSBC want for a port + additional borrowing?

sequin123

Hi

thanks for your replies

getmore4less - didnt know I had to pay to port my existing mortgage?? For the additional borrowing we are at 75%LTV and the options are:

4.39 - 2 yr fix £599 fee
5.89 - 5 yr fix "
3.89 - 2 yr fix £999

3.39 - Tracker + 2.89 boe - £599 fee
3.69 - Tracker + 3.19- Nil fee

Or the new split loan product

Thrugelmir

With increased FSA levies to fund the compensation paid to Icelandic banks, increased cost of money to lend, less available capital to lend, lenders rebuilding capital buffers and increased competition for retail deposits. The days of low borrowing rates are over. Maybe not entirely but in the mainstream yes.

On such a low rate make hay while the sun shines. Save save save. As you can earn more on your savings than repaying your mortgage. So why pay interest on an increased mortgage? There'll never be an opportunity to build capital risk free like this again in your lifetime.

Wait and watch. There's so much uncertainty in the short /medium term better to see how events unfold. Events in Greece show unstable the world can be once market forces take hold.