My mortgage situation - remortgage time

kingcreech

[FONT=Verdana, Helvetica, Arial]Me and the good lady have had our current (and first) mortgage for around 19 mths, it is a 2 yrs tracker with Santander and it is due to end in September this year.

(Some info - we got our first mortgage nearly 2 yrs ago, we paid over 10% deposit and borrowed £140,000 over 35yrs. Being first time buyers the term didn’t really bother us as it was all about just qualifying for a mortgage. We was given a rate of 5.9%. We bought our house as a repo and so it is worth quite a bit more then what we paid.)

I know very little about mortgages so my first step was to ask Santander what deals they could offer me on a new mortgage.

Here is what they came back with

SAME REMAINING TERM (33yrs)

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1. [FONT=Verdana, Helvetica, Arial]Fixed 5yrs. 4.9% rate. £125 fee. - Saving £75 per month on current tracker [/FONT]
2. [FONT=Verdana, Helvetica, Arial]Fixed 3yrs. 4.4% rate. £621 fee. - Saving £120 per month on current tracker [/FONT]
3. [FONT=Verdana, Helvetica, Arial]Tracker 2yrs. 4.4% rate. £125 fee. - Saving £120 per month on current tracker
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REDUCED TERM (28yrs)

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1. [FONT=Verdana, Helvetica, Arial]Fixed 5yrs. 4.9% rate. £125 fee. - Saving £20 per month on current tracker [/FONT]
2. [FONT=Verdana, Helvetica, Arial]Fixed 3yrs. 4.4% rate. £621 fee. - Saving £63 per month on current tracker [/FONT]
3. [FONT=Verdana, Helvetica, Arial]Tracker 2yrs. 4.4% rate. £125 fee. - Saving £63 per month on current tracker
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We have been fine on our current tracker as the rates haven’t changed and I think we would of managed ok if the rates would of gone up.

All the above are saving on our current payment but I think we both like the idea of fixed rates due to the security.

Do you think the above rates and fee’s look ok? Should I be going to a broker to try and find a better deal? Or should I be trying myself by going to other companies?

Can I ask, do you pay fee’s in cash or does the fee go on top of the mortgage?


PS - I’ve just tried the mortgage calculate and reduced the term even further to 23yrs so that is reduced by 10yrs and the monthly payment for 3yrs fixed (using the 4.4% rate above) isn’t that much different to what we currently pay, would you advise dropping the term this much or is it allowed to be dropped this much?


Thanks for any help, I’ll keep an eye on the thread incase more info is needed from me (I know I will have forgot something).





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money_maker_2

I would look online yourself for better deals. Play around with online calculators. I know Nationwide do 5 yr fixed for around 4% and their fees have been reduced recently.
Fees can be paid upfront or can be added to the loan. If added to the mortgage, then obviously your monthly payments will be a bit higher, but not much.

Wh05apk

Shop around as MM says.

Also a bit confused, you are quoting a tracker at 4.4%, Abbeys SVR is 4.24% which is what you will be reverting to.

If you are a high Loan to value, then the SVR may be your best option, as lenders are generally not offering good rates for high LTV remortgages - bear in mind that the lenders valuation will often be lower than your estimate, thereby increasing the LTV further.

kingcreech

Thanks all

Not sure if I am a high value to loan customer but I probably am.

Zoopla says my home is worth £195k but I think it is worth quite a bit more due to the work we have done on the house, £195k is still great as we paid £160k.

We paid 20k deposit and our mortgage is currently at £137333.

At the weekend I followed a link from the MSE site to an independent brokers and they just called to run through some info, no time at the minute and I wanted to check them out so calling again tomorrow.

The company was Taylor Made Finance, any body heard of these?

LittleMissAspie

Zoopla isn't necessarily accurate, it guesses and is often wrong. You need to look at how much similar houses have sold for recently. As long as it's worth at least 182k, that gives you 75% LTV which can get you decent rates. The next LTV down would be 65%, the house would have to be worth about 210k for that.

It's prudent to keep the term the same (33 years) if it doesn't affect the rate. You can overpay to save on interest but if you happen to made redundant or anything, your normal payments will be lower and more manageable.

kingcreech

Thanks for the help yesterday.

I went home and checked out my current deal which ends in Sept, when this finishes I go on the SVR which is at 4.24%. Would it be a problem to stay on this rate if needed? Then remortgage when needed?

Will try and check out other deals but just a little bothered my VTL won't qualify, how would I try and find out what my house is currently worth to companies like nationwide who are offering 4% 5yr fix for a 80% mortgage?

I might have to wait until the end of the month before I can go for deals from other companies as they tend to have a 3mth limit set and mine does not end until the end of Sept.

R_P_W

From what you have said above the SVR @4.24% looks like your lowest cost option on table at the moment. Unless you have 75% LTV or better you probably won't find anything much better and a lot of other lenders have fees above £1k.

The lender can change the SVR as they wish, so even if BOE rates stay same they can increase.

If a fixed rate gives you a bit more peace of mind and security then probably worth paying a bit of a premium for it. If it was me I would continue to pay at the same payment you pay at now - that way your mortgage term will reduce on its own and you will pay less interest over the term.