When to sort out new mortgage

needing-help

We have been on a 5 year fixed rate motgage with Halifax which finishes in July. When should we start looking for a new one. I know the interest is higher on fixed rate ones but I like the fact that we know what is going out.

I would appreciate any help. Thanks

originalmiscellany

Simple. Generally you can apply for a Mortgage in principle (MIP) for upto 6 months in advance, and pay only the setup fee if you go back on your decision...
You need to decide on whether to go to a mortgage adviser or go direct. It sounds from what you've said (not a lot!) you'd benefit from going to a mortgage adviser who can help you get a good deal.

But key questions really are:
Are you on a interest only or repayment mortgage?
What's your current loan to value ratio?
Do you have any other savings that could be used to lower it?

Answering these should give a more detailed answer but from the skeleton you've given, I'd say speak to a whole of the market mortgage adviser.

GMS

If you were to apply today you would be looking at mid April for an offer most likely. Your current deal expires in July so you would not want to complete until then or you would incur Early Repayment Charges (I assume)

A mortgage offer would be valid until July so no need to rush, you could complete the day the ERC's no longer apply.

Keep in mind that lenders have 2 versions of fixed periods. There are set dates, i.e fixed until xx/xx/20xx and there are fixed for x years from completion.

If you went for a fixed until xx/xx/20xx you would lose the first 3 months or so of the fixed period. May be a product like this has a better rate than a x years product so worth the loss.

Start looking now and see what is available.

needing-help

Hi and thank you both for the advice.

originalmiscellany, Sorry it was a rubbish post I wasnt really sure what to put:o
At the moment we have a repayment mortgage. It is for £135,000 and the house is worth around £250,000.
We have no real savings to speak of.

GMS I have never heard of the fixed for x years from completion. When we took this one we had the option of 2, 5 and 10 years with varying interest rates so went for the middle ground.

One other question how can I find a decent mortgage advisor, the first one we used when we were just starting out and were young and naive just sold us all sorts of useless products (Including an endowment) which he got a big fat bonus for and a monthly payment for.

Thanks again

GMS

needing-help wrote: »

Hi and thank you both for the advice.

originalmiscellany, Sorry it was a rubbish post I wasnt really sure what to put:o
At the moment we have a repayment mortgage. It is for £135,000 and the house is worth around £250,000.
We have no real savings to speak of.

GMS I have never heard of the fixed for x years from completion. When we took this one we had the option of 2, 5 and 10 years with varying interest rates so went for the middle ground.

One other question how can I find a decent mortgage advisor, the first one we used when we were just starting out and were young and naive just sold us all sorts of useless products (Including an endowment) which he got a big fat bonus for and a monthly payment for.

Thanks again

Your loan to value would potentially allow access to the better rates.

When I said x years I meant 2,3,4,5 etc. Tre ones wioth a fixed expiry date would be until then, the x years would be from completion date.

For example a 2 year fixed today may expire on 31/05/2013. If you completed in April you would get 2 years and a bit. In your situation you cannot complete until July so on that scenario you would get 1 year 10 months approx.

If you do not want any advice other than mortgages make it clear from the start. Agree fees up front and move from there.

Recommendations are the best way, but not always possible. Yellow Pages, google, local ads etc another way, or you could find somebody on the forum if you chose.


Rates are on the move at present so you may bebest securing something sooner rather than later.

needing-help

Thank you again, I was being a bit thick about the fixed rate thing:o

I will definitely start looking now and try to sort the best deal. I lost my job in August so if we could get the monthly payment down a bit it would really help.