stay on svr or fix

ripon12

im in a delema my svr with halifax is 3.5% but i have a remortgage available to take at 3.99 fixed for 5 years which i organised in january but havent drawn it as i am tied with halifax till june with a small part of my mortgage £30000 at 6.5% and 63000 on the svr i owe 93000 all together with a valuation on my house at 220000
should i be fixing or should i forget it and ride the storm

originalmiscellany

Take the fix I say, and save whatever you can over the next 5 years to ensure that you can make a substantial overpayment in 5 years time when this fix finishes...

ripon12

forgot to say im overpaying 250 a month now but can only over pay 10% (about £120)a month with new hsbc mortgage so looking to invest the rest into some sort of isa ???i think any ideas
or am i best not to overpay and invest more over the 5 years and pay lump at end

blueberrypie

I'd fix and overpay.

On 3.99%, you'd have to be earning 5% or more in an ISA or other savings vehicle to make it a better option than overpaying.

Edit to correct myself: you'd need to be earning more than 3.99% in an ISA or other interest-free savings vehicle. You'd need to be earning 5% or more in any savings vehicle which is taxed, assuming you're a basic-rate taxpayer.

ripon12

cheers blueberrypie thats what i needed to know as i was unsure wether saving at 3.99 or above was better( if i could find something that is), but saving at 5% or above doesnt seem achievable at the moment
only other thing is should i be looking to go on a cheaper tracker were i can make unlimited overpayments or take the 3.99% now

sammyjammy

ripon12 wrote: »

cheers blueberrypie thats what i needed to know as i was unsure wether saving at 3.99 or above was better( if i could find something that is), but saving at 5% or above doesnt seem achievable at the moment
only other thing is should i be looking to go on a cheaper tracker were i can make unlimited overpayments or take the 3.99% now

Definitely fix, if you can overpay 10% witt the new mortgage thats normally 10% of the balance not the monthly payment, so if your remortgage is £93k then you can overpay £9,300 in the first year which is £775 a month!

ripon12

just checked kfi and i can overpay 20% of the monthly payment wich is about £120 per month i thought it was 10% but that would have only been £60 a month !!!
i think im loosing it

dimbo61

If you can afford to overpay each and every month have you considered reducing the term ?
Check how much it costs to reduce/increase the term ( my lender charged me £50)
I took my mortgage over a longer term and then reduced the term by 12 years once we had started paying it each month.
That is a very good long term fix which is only 0.5% above what you are paying now
Do you see rates rising over the next 5 years ???

getmore4less

ripon12 wrote: »

im in a delema my svr with halifax is 3.5% but i have a remortgage available to take at 3.99 fixed for 5 years which i organised in january but havent drawn it as i am tied with halifax till june with a small part of my mortgage £30000 at 6.5% and 63000 on the svr i owe 93000 all together with a valuation on my house at 220000
should i be fixing or should i forget it and ride the storm

The small bit is 32% not small enough to ignore.
You also need to sync the loans so you do have more choice in the future.

What are the fees?
How long is the fix avaialble for(often 6 months)?
What is the followon rate?
Can you borrow 93k on the fix?(pay off the £30k in june)
What option will there be for the £30k?
What is the follow on rate
Will there be any fees?
ERC for the £30k?
WIll they let you add this to the £63k and waive the fees?

You need to do a bit more thinking.

Remember if you leave the £30k to follow on there will be no overpayment limit.

I am thinking it might be worth costing borrow £93k on the fix leave it as long as you can before drawing the funds then pay off the £30k as soon as the ERC has gone.
This will cost £100pm which might be less than any fees for doing something with the £30k june


Is this Halifax or HSBC? ( you mention both)

ripon12

ok im currently with halifax i have arranged to get the whole amount (93000) on 3.99% through hsbc with a £99 fee
the fix is for 5 years
follow on rate 3.94 (svr)no tie inns

erc for the 30,000 is 650 but that ends in june and looking to move from halifax begining of july
so in june the whole of my mortgage will be on the same rate if i stay with halifax or move elsewere but not sure wheather i should track or fix

kazd

What is the Halifax base rate. All the advice in the news yesteday was not to fix as the bank of england base rate needs to rise by approx 9 1/4 point rises before you should think of fixing.