Need another £15k, how does this offer look?

longwalks1

InMyDreams wrote: »

Not necessarily. Paying anything, that is.
I also took out a 5 year fixed 4.99% offset with FD less than 3 years ago (so possibly in similar position to OP). At the time I was looking, I was not bothered about the offset facility, but it was overall the best 5 year fix (which was what I also wanted) at the time. The offset bit was incidental. (Now you can get better rates if you don't offset, but that wasn't the case back then.)

Exactly the same as me my friend, didnt know much about offsets til the FD one came up on here funnily enough, everyone and their dog praised it and said to snap it up and i was lucky enough to 2 1/2 years ago

The offset facility is brilliant and my companys share saving scheme free's up shares every year so i put that into offset it, with possibility to use it if needed

longwalks1

Let_Us_See wrote: »

Also, my immediate thought! Why are you paying such a high offset interest rate when you have no savings to offset? Defeats the whole purpose of an offset scheme.

Wasnt a high interest rate 2 1/2 years ago when i fixed it for 5 years as was unsure of the market and wanted some stability in my payments, in fact InMyDreams will vouch it was a bl00dy good deal when we took it out

longwalks1

GuidoT wrote: »

Of course it is up to you what you tell them, I am not suggesting you lie though.

Perish the thought of fibbing to a lender

But surely it defeats the object a lender lendeing me the same amount (or more), to pay off an existing loan with them, which is at a higher % rate? Or would the fact I want to secure it for a longer period of time appeal to them?

Thanks again everyone

Thrugelmir

GuidoT wrote: »

Do not see how an ERC would be that relevant with an offset mortgage.

The offset is merely a secondary product attached to the mortgage. Fixed term mortgages of any type envitably come with an exit charge .

Thrugelmir

britishboy wrote: »

Asked them when i phoned about the additional lending, and a £2k fee to get out early, i would ideally like to find the longest term possible fixed rate (or offset), and pay the £2k ERC, then fix it for X amount of years

You also need to consider the interest rate post fix. How does your existing mortgage compare with what's on offer?

longwalks1

Thrugelmir wrote: »

You also need to consider the interest rate post fix. How does your existing mortgage compare with what's on offer?

current SVr rate is 3.69% (so 3.19% above base), im guessing it would probably be 3.19% above whatever base rate is in 2 years when it comes to an end

ERC is 2% of initial borrow (cant remember tech term he used), worked it out as £2,206 to get out of it

longwalks1

bumpety bump mortgage experts

So how does the offer look? Worth taking out then in 2 years time combining the 2 into 1?

Meeper

I would probably take the offer, given the information to hand.

Mallotum_X

britishboy wrote: »

cheers people

I have £30k in savings thats used to offset approx 50% of the time (the other half its in shares - then back into savings once a profit made)

Why borrow if you already have more than 15k in savings? Why not just use that?

longwalks1

Meeper wrote: »

I would probably take the offer, given the information to hand.

Meeper, would me giving you more info help in confirming your opinion?