Advise needed - don't want to make wrong decision

tilly78_2

Hi

I am planning on selling my property and moving on to a new property.

I am currently on a 5 yr fixed term 'Santander' mortgage which i took out in 2009 with an interest rate of 4.89%.

I did plan to just port this mortgage and increase it, however the monthly charge for the additional fees was more than i could afford. Therefore have decided to just cut my losses, pay the ERC and bow out of my Santander mortgage.

I have decided on a first direct mortgage for my new property - i did look at HSBC as there rates are even lower, however after reading all the problems people have had with them i think i would prefer to pay more money!

I have a 68% LTV which equates to a 75% LTV with first direct. I initally was looking at a term of 25 years, however think i may opt for 30 years, lower payments and make an overpayment monthly this way if something happens (lose job etc) then i can always revert back to making the lower payments without the overpayment for the time needed - Is this a silly idea????

I have decided against a fixed term product, therefore have been looking at there 2 year tracker and lifetime tracker.

The 2 year tracker - fee free - is 2.89%

or

Lifetime tracker - Fee Free is 2.69% plus base - currently 3.19%

Or if i pay the fees £499 arrangement, £170 valuation then it drops to 2.39% plus the base.

At this point would it be best to just go for 2 year deal or is it a good time to move to a lifetime product? If i went for the lifetime would it be better to opt for lower rate and cough up the money for the fees.

Any help is gratefully appreciated as i hate making decisions.... :):):):)

ACG

Hi,

What your after were not able to answer....atleast not anyone qualified and practising.
Its classed as advice as were telling you which to go for, if that then turns out to be wrong advice then you could go to the financial ombudsman and make a complaint about us. Until we have conducted a fact find, done research and all the rest of it were not in a position to do that.

This is part and parcel of not going through a broker, you make the decision and if theyre wrong it falls on your head.

Also from what i can gather first direct can be quite strict on criteria too, i dont think theyre as bad as HSBC but if you have a less than perfect credit report bare this in mind before making an application. Just because you want the best rate doesnt mean you will get it.

GMS

This needs careful consideration.

Is paying the ERC a good idea to then move to a rate which could change?

Would you be better looking at a long term fixed in order to justify the ERC?

Also you are looking at extending the term. This may mean paying back more over the term than you would have done previously. You need to be aware of this.

Overall make sure you are not paying fees simply to lower your monthly paymeent in the short term. There will also be legal fees to pay to change lender so factor these in too.