Mortgage Options with only 4.5 yrs left

mcfisco

Hi all,

Wonder if someone knows what options we may have available to us?

We have just had a letter from Halifax to tell us that our 5.79% fixed rate is coming to an end
They've said that if we do nothing we'll simply be transferred to their SVR [currently 3.5%]
Further on in the letter it says that if we do choose to switch to a new deal we'll go onto their 'Halifax Homeowner Variable rate' [currently 3.99%]
Doesn't seem to be much of an incentive to do anything there unless I've misunderstood something.
Not had our year end Mortgage statement yet but last year's was £37,876 with 5.5 years left to run.
We've paid £8361 off in the last 12 months, so I'm expecting a statement of ~£30K with 4.5 years to run when we get it in February

Is it going to be worth looking elsewhere or - with only 4.5 yrs to go - are we pretty much tied to Halifax?

TIA

Wh05apk

You could look elsewhere, but with a mortgage that size and term, the savings would be minimal, it may be worth speaking to Halifax to see if they have any retention products available, however make sure you take the no fee option, as you will not save enough to recoup any fees.

mcfisco

Thanks for that

I take it Halifax are just telling us that the only option other than SVR is a higher rate product?

I'll try ringing them all the same and see what's available

Wh05apk

They should have the following available: link removed

mcfisco

Thanks, very useful link

mcfisco

As an update:

I got 3.49% fixed for 2 years with zero fees from them

thanks for the help

dimbo61

But you still have the option of doing nothing and dropping onto the SVR of 3.5% ( that will be a tracker which follows the BOE base rate plus 3%)
Now if you go onto the 2 year fix you then go onto the " New SVR of 3.99%" which does not have to follow the BOE base rate.
Might you be better off going onto the SVR at 3.5% and keeping your payment static Therefore overpaying each month ???

mcfisco

We're going to over pay anyway [up to 10% pa]

IMO interest rates won't go down and, as someone with a newish mortgage when the rates sky rocketed in 92 with rates varying enormously from month to month - 10, 15% back to 10 - anxious times for young families
Times - if anything - are more uncertain now

I realise, with a relatively low balance, that effect wouldn't trouble us much now but I'm happier fixing it at a figure that I don't think will be bettered by leaving it at SVR for 2 years

dimbo61

You have no limits once on the SVR !
Yes interest rates wont go down BUT they have been 0.5% for over 2 years now with a very fragile housing market.
I have also been on 15.4% for my mortgage back in the 80/90,s
If you take the 2 year fix you will after the 2 years end up on a higher rate SVR 3.99% and be limited on overpayments.
me I would overpay every penny I could now while the sun is shinning