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Options for Mortgage <5 Years To Go
Marvel_2
Posts: 5 Forumite
We're in the fortunate position of being on target to pay off our mortgage in just under 4 years. The amount outstanding at the end of last year was £17.5k. Unfortunately as a result of bad financial advise in the late 80's we converted our original repayment mortgage to an intrest only/endowment. This is has been sorted now and we are back on a repayment but as we had such a short time left it was only converting the intrest only mortgage to an SVR. The SVR is now 7.39% which when reading through the intrest rates available for fixed term loans seems a lot. My question is should I leave things as they are or look into taking out a cheap loan to pay off the mortgage? Probably a stupid question with an obvious answer but I don't know what it is.
TIA
TIA
0
Comments
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I'd have a read of the banking and loans section of the site. But just to give you an idea of costs a loan of £17.5k over 48 months with the AA has repayments of £415 a month at 6.2% apr without payment protection.
Quote at:
http://theaa.com/finance/finance_quote.jsp
A loan from Nationwide at 6.7% for some reason works out about the same even though their APR is shown as 6.7%
https://www.nationwide.co.uk/loans/quick-quote.htm?type=2&fromWhere=Calculate
You may find that because of the short time/small amount left the savings are not that great when you factor in that there may be a charge from your lender for closing the mortgage account and releasing the legal charge on your property. If that seems high - read up about Bank Charges as you may be able to challenge it.0
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