Early repayments, mortgage terms and all that interest

jackyann

Look at the Home Building & Renovating site, buy a couple of magazines and contact one of the big exhibitors to blag a couple of free tickets to one of their exhibitons. If you don't want to wait, you can visit the Self Build Centre at Swindon that has small permanent exhibitions.
Through either you can get information about finding building plots (google Plotfinder for initial ideas)
Get hold of some sensible books like those by David Snell or Mark Brinkley.
Don't watch Grand Designs, most of us self-builders are more like "My Flat Pack Home".
To self build, you need:
a grasp of details
ability to organise
patience
if you are a couple, a shared ideal, and an agreement as to where compromises can be made and where they can't.
It is really worth looking at, but very carefully!

getmore4less

spence wrote: »

I agree with the above, especially for best rates. Also look at the one account from RBS. The rates are a good bit higher but have much better flexibility.

One account has no extra flexability over most other offsets and in at least 2 cases is less flexable.

Barclays allows cash ISAs.
YBS has offset pluss.

getmore4less

Best rates need 40% deposits.

If you are going to buld up the offset very quickly then the interest rate is slightly less important.


what sort of numbers are we looking at?

Both annual incomes, savings, house price range.

indextwo

40% deposits are, in the immediate future, out of my range (on a £220-£250k house). I'd be looking at at least another 18 months to 2 years for that. And that, if I've managed to save that amount of money, is the point where I'd seriously start to think about just waiting it out a bit longer and not bothering with a mortgage at all.

Like I said, my initial plan was 3-5 years of building capital, planning and learning as much as I could; but I'm well aware that my wife is quite to move somewhere a fair bit sooner than that, and I'm much more up for making her happy.

pinkteapot

If you don't get an offset, check the overpayment terms on any mortgage products you look at.

Fixed rates and other 2/3/5 year deals generally have limited overpayments during that 2/3/5 year period - often you can increase your normal monthly repayment by 10% and that's it. Any higher overpayments incur penalty fees.

We have an HSBC lifetime tracker mortgage (lifetime = for the life of the mortgage) so it's Bank of England base rate plus 1.99% (we currently pay 2.49%). As it's a lifetime product, overpayments are unlimited from the start. We took it out over 15 years last August because of the interest saving versus 20, 25 or 30 years. Overpayments have already reduced our mortgage term by 3 years and our interest due over the life by about £7k if I remember rightly.

Trackers are cheap at the moment (if you have a good deposit) - much cheaper than fixed rates because banks expect the central rate to go up. Obviously as soon as it does a tracker repayment will go up. But, if you plan to overpay heavily, I think they're a good way to go. Again, this is if you don't get an offset because you've had good advice on how they'd suit your circumstances.