Fixed to Interest only for 2 Years

The_Trevsta

Hi,

Just an idea I would like to share to get some thoughts of people far more savvy than me!

210k property 159k left to pay with Coventry ... Rate 4.99 going down to 4.74 svr on July 1st

Thinking of staying on this rate for a few months to get below 75% ltv then swap to an interest only for 2 years so my payments would go down from £1325 to £500ish and save the difference to get some cash in the bank...

Does this seem feasible ? I know IO are hard to get but that was an idea I had earlier

Any thoughts peeps?

Thanks

Trev

marathonic

The_Trevsta wrote: »

210k property 159k left to pay with Coventry ... Rate 4.99 going down to 4.74 svr on July 1st

Thinking of staying on this rate for a few months to get below 75% ltv then swap to an interest only for 2 years so my payments would go down from £1325 to £500ish and save the difference to get some cash in the bank...

At that payment, mortgage level and rate, it looks like you've about 14 years left on your term.

Why not switch to something like Britannia's 75% Tracker at 3.19% and, instead of going interest only, go with a 20 year term with a £900 repayment. Then save the difference in an emergency fund.

It'll be difficult to get an IO mortgage and damn near impossible to get one for a meaningful enough term to save a good emergency fund.

When your emergency fund is in place, start overpaying your mortgage.

The_Trevsta

Thanks for the prompt response.. never thought of this angle im glad i posted and yes 14 years exactly from 1st July

thanks again

Trev