Which fix is cheaper?

PeteW

Hiya,

I've had conflicting reports from L&C and MortgageMonitor (the two brokers Martin recommends) when comparing these mortgages.

The top options are:

ING's 5 year fix at 4.49% with no fees
Yorkshire's 5 year fix at 4.39% with and £495 fees + £90 exit fee
Northern Rock's 5 year at 4.38% with £995 fees

The mortgage is for £156k over 22 years.

L&C say ING are cheapest, MM say Yorkshire is cheaper.

Anyone know who is right?

Ta

Pete

dimbo61

That depends on the size of the mortgage and I think you will have an exit fee from ING as well.
You could use "whatsthecost" and put in the mortgage amount yourself and see how much you would have paid off after 5 years ETC

Gorgeous_George

I think it is best to add the fees to the mortgage for calculation purposes.

I make it that ING is cheaper over 25 years (£100K mortgage).

GG

PeteW

Sorry, I should have mentioned it's a £156k mortgage over 22 years (but I'd ditch after the 5 years).

TrickyDicky101

Provider_______________ING______Yorkshire___NR
Rate/Nominal pa________4.49%____4.39%_____4.38%
Term/years____________22________22________22
Fee__________________£0________-£495_____-£995
Amount borrowed______£156,000___£156,000___£156,000
Monthly repayment____ -£931______-£922______-£922
Total Int in 5 years___-£32,546____-£31,794___-£31,719
Total cost in 5 years___-£32,546___-£32,289____-£32,714

The total cost in 5 years line assumes payment of fee up front (ie not added to loan - so it makes the fee products a bit cheaper).

kingstreet

Any of those deals could become the hands-down winner if there's a free valuation, refund of valuation fee, or free legals.

We need to know if it's a purchase or remortgage and the property value, or purchase price to be able to work that out properly.

As Tricky has shown, it's too close to call on the rate.

kingstreet

Just as an example, the Yorkshire deal mentioned, if it's the sub 75% LTV purchase deal coded 7463, it also has a free valuation and a £250 cashback on completion.

PeteW

It's a remortgage. The house is worth approx £270k, so it's a LTV of about 58%.

kingstreet

Ok. The ING deal is fee-free, no valuation fee, no arrangement fee and no legal costs to pay. £156k over 22 years is £931.06 per month, or £55,864 with no additional costs for fees.

The Yorkshire deal is £922.49 per month, or £55,349. Added to that are the booking and arrangement fees of £495 and the exit fee of £90. There is no valuation fee or legal charge, leaving a total of £55,934.

Northern Rock's 4.38% fix gives monthly payments of £921.64, or £55,298 over the five years. Added to that is the £995 arrangement fee and my system is showing a free valuation and free legals, but quotes a £99 application fee. In total, that would add up to £56,392.

Of the deals you've quoted, the ING deal is cheapest overall. I'm out for the next hour or so. When I come back, I'll run all the deals and see if anything comes back better overall.

PeteW

Thanks Kingstreet, that is exceptionally helpful of you!!

How does Yorkshire's £250 cashback fit in - would that apply to me?

Good to see they're all very close - I'm a bit worried they they wouldn't be able to lend me enough so nice to have some good backups.

Cheers

kingstreet

No. The cashback doesn't apply to you, that's for purchase cases. Arguably you're better off as the legal costs are paid for you instead.

I've run the deals through Mortgage Brain and it confirms what I'd already suggested. Based on five year total costs, ING is slightly cheaper.

I was using you as a bit of a guinea pig to be honest. I'm currently changing sourcing systems, so I used Trigold, the old one, to do my research, now I've just used Mortgage Brain to verify it. They are a little different, so I'm practicing.