Remortgaging: borrowing less than the redemption figure

Foxrunner

Hi there

I'm thinking of ditching my current fixed rate (6.34% up to Sep 2017) for the Lifetime Special Tracker with HSBC (BBR+1.79%, £99 booking fee). I get clobbered for £2700 early repayment charges, but I still reckon I'm better off if rates stay below 5% for the next 10 years. I'm also looking to reduce the term from 15 years to 11 or 12.

The only other time I remortgaged, I borrowed as close to the redemption figure as possible. I just assumed at the time that you had to, and the mortgage adviser at the Co-op didn't say otherwise.

The current redemption figure is £53,800. Am I able to borrow less than that (say, £51,000) on the remortgage, and pay the shortfall out of my savings when the mortgage completes?

Any advice greatly appreciated

Matt

hcb42

Yes, this is possible

Thrugelmir

Foxrunner wrote: »

, but I still reckon I'm better off if rates stay below 5% for the next 10 years.

That's a very optimistic assumption.

Can you overpay on your current mortgage?

Foxrunner

Thrugelmir wrote: »

That's a very optimistic assumption.

Can you overpay on your current mortgage?

I can, up to a maximum of 5% of the outstanding balance.

Thrugelmir

Foxrunner wrote: »

I can, up to a maximum of 5% of the outstanding balance.

Maybe better to overpay the mortgage than pay the ERC in that case.