Mortgage Query

lukem30

Hi, i'm new to the forum and would appericiate some help to work out if i should remortgage or not.

My current deal is 3 year fixed direct FTB from Nationwide and it is due to end june 2011.
My current fixed rate is 6.45% but after after june 2011 (end of fixed term) the rate will follow nationwides base mortgage rate (standard variable).
I know the rate is variable and it changes but where can i find this rate and how do you calculate estimated repayments useing the rate. Pehaps if i could calculate this i could work out if its better to remortgage or stay with nationwide.

Sorry for a real noob question but i'm unsure of the whole thing. thanks

beecher2

Nationwide's SVR is 2.5% I think. Put your details into any mortgage calculator to find out how much you'd pay, but remember that there's no guarantee rates will be the same by June 2011.

Here's a calculator here
http://www.moneymadeclear.org.uk/tools/mortgage_calculator.html

silverfoxuk

Nationwide's SVR is currently 3.99%. BoE Base Rate is currently 0.5% so the SVR margin is approx. 3.5%.

If however you currently have a Nationwide mortgage product which was reserved on or before 29th April 2009 then it will revert to the Nationwide's Base Mortgage Rate (BMR) when the deal ends.

The Nationwide BMR is guaranteed to be no more than 2% above the Bank of England Base Rate, so at the moment the BMR is just 2.5% (2% + 0.5% BoE Base), whilst the SMR has no upper limit or cap. If when your deal ends you choose to switch to a new Nationwide product, it is not possible to switch back to the BMR at a later date.

Nationwide Mortgage Options
http://www.nationwide.co.uk/mortgages/interestrates-types/rates.htm?buyerType=ec-de&propertyValue=200000&mortgageAmount=100000#bmkBmr

Food for thought.....

JimmyTheWig

What penalties will you pay for coming out of the deal early? I.e. what's your ERC?

lukem30

my erc is £1915, so it would be better to wait until the end of the fixed term and stay on the tracker rate of 2% above the base rate untill rates go up, them remortgage?
Thanks for your help

dimbo61

You need to read the paperwork that came with the mortgage offer and find out if you go onto the SVR or the BMR or just give the mortgage centre at Nationwide a call with your mortgage details.
Find out what rate you revert too and how much you will still owe come June 2011.
Now using "whatsthecost" you will be able to work out how much your new mortgage payment will be IF? rates stay the same.
Overpay if you have no other debts!

JimmyTheWig

lukem30 wrote: »

my erc is £1915, so it would be better to wait until the end of the fixed term and stay on the tracker rate of 2% above the base rate untill rates go up, them remortgage?

And how big is your mortgage?
(Sorry, should have asked this earlier.)

koexelek

silverfoxuk wrote: »

Nationwide's SVR is currently 3.99%. BoE Base Rate is currently 0.5% so the SVR margin is approx. 3.5%.

If however you currently have a Nationwide mortgage product which was reserved on or before 29th April 2009 then it will revert to the Nationwide's Base Mortgage Rate (BMR) when the deal ends.

The Nationwide BMR is guaranteed to be no more than 2% above the Bank of England Base Rate, so at the moment the BMR is just 2.5% (2% + 0.5% BoE Base), whilst the SMR has no upper limit or cap. If when your deal ends you choose to switch to a new Nationwide product, it is not possible to switch back to the BMR at a later date.

Nationwide Mortgage Options
http://www.nationwide.co.uk/mortgages/interestrates-types/rates.htm?buyerType=ec-de&propertyValue=200000&mortgageAmount=100000#bmkBmr

Food for thought.....

Of course, the Nationwide like to lead all their borrowers to believe they are going onto 3.99%, even if they are actually going to go on to 2.5%;)

lukem30

JimmyTheWig wrote: »

And how big is your mortgage?
(Sorry, should have asked this earlier.)

my mortgage is currently just over 95,000 over a 30 year period, i had to take it out over a long period as it was my first purchase and it needed to be as affordable as possible

dimbo61

You need to find out what rate you go onto next year!
now if it was me I would ask Nationwide to keep your payments static IE the same as you have been paying for the last 3 years and therefore overpay the mortgage every month. When rates rise you will still be overpaying the mortgage each month untill rates go over 6.45%

JimmyTheWig

lukem30 wrote: »

My current deal is 3 year fixed direct FTB from Nationwide and it is due to end june 2011.
My current fixed rate is 6.45%

lukem30 wrote: »

my erc is £1915, so it would be better to wait until the end of the fixed term and stay on the tracker rate of 2% above the base rate untill rates go up, them remortgage?

lukem30 wrote: »

my mortgage is currently just over 95,000 over a 30 year period

Ok, so you're looking at a 2% ERC. Paying this charge would get you out of paying over the odds (6.45%) until June.
It will take you a good few weeks to sort out a remortgage from now. Which means you'll be knocking about 6 months off the time you are paying 6.45%. To make it worth paying 2% ERC to do this you would have to knock 4% off your interest rate. With no fees.

I doubt that you can find a mortgage for 2.45%, so don't bother remortgaging at least until your deal is up.

In a month or so you need to start looking around at your options for what you want to do come June. It sounds like the best option will be to stay where you are, but you may prefer the surety of a fixed rate, etc.
But for now, I would do nothing.