Purchased Value vrs Real Value of Property

JohnJack81

Hi All

I am a little new to all this so please bare with me, even if this is an incredibly daft question.

Me and my partner purchased a semi back in April for £145k with a 75% ltv (all we could get together at short notice) in the knowledge that it was a bit of a fire-sale due to the break up of the sellers marriage and a change in circumstances.
Looking at other houses in the same area, they seem to be currently on the market/selling for between £15k and £20k more (same design of 1970's semi, Robinson Sloss I think they are called).
Should we get our home revalued would that new value enable us to decrease out ltv and potentially get a better rate? It could decrease our ltv to potentially 75% and unlock the more favourable rates?

What's the most reliable way of getting the my property revalued?

kingstreet

If you had a 75% mortgage when you purchased it, even if the property is only worth what you paid when you bought it, capital repayments you've made mean the loan to value should still be at or below 75%.

If you decide to remortgage to a new lender, the lender will arrange a valuation to work out the exact loan to value and this will mean you either qualify for whichever product you've applied for, or the lender will notify you you need to change products if you don't. Many lenders offer fee-free products for remortgaging. This means it costs you nothing to find out!

Alternatively, approach your current lender to see what "customer retention" products are available to you without you having to move. This will, if nothing else, give you a point of comparison with the other deals you look at for remortgaging elsewhere.

Be careful. You may face an early repayment penalty for moving lenders/products if you only bought in April.

Thrugelmir

What's the current interest rate you are paying?

Are you tied in to your current lender for a given period of time ?

JohnJack81

We are currently fixed 3 years @ 4.9% (at the time the available tracker for this ltv was only BoE +3.5%, so with the base rate at 0.5% and expecting BoE to to have gone up a little since, which it hasn't even with inflation high)
This all maybe a little immaterial for right now but we are currently putting together a plan for the next few years.

poppy10_2

JohnJack81 wrote: »

We are currently fixed 3 years @ 4.9% (at the time the available tracker for this ltv was only BoE +3.5%, so with the base rate at 0.5% and expecting BoE to to have gone up a little since, which it hasn't even with inflation high)
This all maybe a little immaterial for right now but we are currently putting together a plan for the next few years.

Presumably you'll have to pay a hefty Early Repayment Charge if you break out of your current 3-year fix. Your rate isn't bad at all, you're unlikely to save enough by remortgaging to justify the ERC.

somethingcorporate

It almost certainly won't be worth it, just keep paying down the mortgage / save if you get OP penalties until you are done with your 3 year fix and try again then.

They won't re-value in the middle of a fixed period purely for your benefit so you would need to move to another lender.

HAMISH_MCTAVISH

poppy10 wrote: »

Your rate isn't bad at all,.

It's atrocious.

The best trackers are currently around BOE + 1.89%, and there is absolutely no chance of rates rising enough within the next 3 years to overcome the gap to a 4.9% fix.

If someone can get out of a high rate fix just now and onto a low rate tracker, they almost certainly should.

There's not a single credible forecaster projecting base rates to rise above 1% in the next couple of years.... Some predict base rates of 0.5% for another 5 years.

The last time there was a financial crisis of similar scale, UK base rates stayed at the then record low of 2% for 8 years...

This is a once in a lifetime opportunity for mortgage holders to overpay and reduce the term. People should take advantage of it.

JohnJack81

HAMISH_MCTAVISH wrote: »

It's atrocious.

The best trackers are currently around BOE + 1.89%, and there is absolutely no chance of rates rising enough within the next 3 years to overcome the gap to a 4.9% fix.

I have seen the Trackers at BoE + 1.89% however the require equity of 40% plus. How many FTB's outside of London and without incredibly rich parents have that sort of money to put down as a deposit until they are in their forties at least?
Believe me if we could have got that we would have, however we could only afford 75% ltv at the time and we haven't stretched our finances.
I am happy to sit on the Fixed rate and possibly over pay to reduce the interest for the next three years. Hopefully we can build up more equity and the house prices don't go through the floor before then. :eek: