Mortgage worries

sarah69696pink

Hi All,
Did post this in house buying and was kindly advised may be better placed here......
Hi All,

I may be worrying over nothing, or having valid worries...either way wanted to gather some opinion if possible here!

I am buyer a house and porting over my existing mortgage (aprox 85k left) at a very good variable rate for the life of the mortage, which I am more than happy with.

With the second part of the mortgage I was offered variable (at 3.5% abouve BoE Base rate) or fixed (5.5% for 2 years. I was given the advice (by mortgage advisor in bank) to go for variable. I paid my £599 arrangement fee and signed contracts etc.

After this I could not stop the niggling doubt I should have possibly fixed the second part. Monthly it will only be about £20 more and at whilst not a brill fixed rate there was no worry about interest rate rises for next 2 years.
I called the bank over the phone the felt it was not be an issue to swap as I had not drawn down on the mortgage.
However after much delay from the right person to call me the oringal mortgage advisor called. Said he did not see there was much difference and there would be another £599 charge to swap now, thanks and goodbye (this was pretty much it - a 75second phone call which he terminated).

I'm now really confused.
There are a number of issues
1- don't think the advisor is great - he really rushed me the first time. yes I know I should have been more cautious before signing initally (please don't lecture me on this - beleive me I am kicking myself).
2- if I do have to pay the £599 again I'm trying to decide if it is worth it for the sense of security.
3 - has anyone else changed mortgages before drawing down on them and did you have to pay?

I've not asked the bank for an appointment ASAP (with someone different from this guy). But unsure what to do if they say it is the £599 to change it.

Thrugelmir

How much is the second mortgage for?

sarah69696pink

The second part is 23k

Thrugelmir

Interest rates won't make a significant difference on such a relatively small balance. If you can afford the £20 possibly more, be worth overpaying and accelerating repayment.

After 2 years you'll be in the same position when the fix expires as being on the SVR.

Seems more of a con to part with £600 to obtain a standard variable product!

betmunch

Sounds to me like you were "sold" rather than "advised" Banks dont care as long as they get the business.

Although I have to agree with Thrugelmir, save the £600 and wait it out for 2 years, then assess whats best when both mortgages are on the SVR

sarah69696pink

Thanks both,
Just seem to be having some last mniute worries as the sale is going though!!
I appreciate the advice, will definitely look at overpaying what I can and reduce the debt whilst interest rates are low.

herbiesjp

As pointed out above, the low mortgage amount will mean that the interest rate will have a very little impact on the mortgage repayments.

It is the fees attached to the deal that will be more important, and dictate whether or not a deal is cost effective for you