Nationwide - to leave the fix you must leave us!

Dave_Ham

It would help you yes..

Firstly - find out the exact early redemption penalty is and go from there

getmore4less

You need to run through the numbers will all costs included for the alternatives.

Don't you have a £500pm penalty free overpayment

Depending on the details one advantage of your current Nationwide deal may be that you can withdraw overpayments should you need, something to check.

when looking at the nationwide deal costs one thing to so is to shortenn the term to the end of the fix, this will increase the normal payment(but not a lot) and there will be no penalties on those.

Joe_Bloggs

47K @ 3.99% over 7 years is 642.22 a month. Total interest 6946.24 + 3% of 36K (1080) = 8026.24
This is not going to happen with the Nationwide.


47K @5.59% over 7 years is 679.64 a month. Total interest 10089.62 + 1080 = 11169.42

Keeping the old Nationwide mortgage costs 37.42 a month , 3143.18 over seven years.

As the mortgage is interest only the initial maximum interest payment is 222.86 This would need to be boosted by a minimum overpayment payment to make a total of 679.64 . That is minimum overpayment
679.64 - 222.86 = 456.78.

This strategy will fail when the interest dips below 179 a month in 20 months time as the 500 per month per mortgage overpayment is reached. There is no way out of this unless Nationwide allow you to convert to a repayment mortgage.
J_B.

Is there any insurance that is linked with these endowments, eg life cover ?

timeou

Thanks very much for your replies

The figures I quoted above include the ERC which is £2400 if I want to leave Nationwide altogether and go to another lender.

Yes, there is life cover with the endowments so I guess I'll have to factor in a monthly payment for alternative life cover If I decide to cash in & go to repayment

JB, from your calculations, it is the sensible thing to do then?

Joe_Bloggs

@timou
You will have to consider the cost of breaking away from Nationwide and the costs and benefits of the most suitable mortgage deal that you can find.

Check your own credit files as lenders are very particular about late payments and worse credit blemishes.
J_B.

timeou

Thanks, its the thought of slowly paying down the balance that is tempting me to do it and I can see that we may be left with a shortfall of up to 15k if I leave the endowments to try & cover it.

And, having a nice little 48k mortgage makes me feel a bit happier too.

There shouldnt be any adverse credit - can't ever remember paying anything late either...(fingers crossed)

Conrad

timeou wrote: »

Sorry to bump this but I still can't decide if this is the sensible thing to do.

Can anyone suggest the best thing - would seeing an IFA help to work it all out?

Thanks

Maybe, but don't let them pursuade you to ditch your existing life policies as they will usualy have much better claims definitions than any new policy.

I would switch lender if it were me, but I'd complain to Nationwide first and then take it to the Ombudsman as you may have rights under the 'Treating Customers Fairly' rules, in particular one that refers to post sale barriers.

timeou

Thanks, the life cover at the moment IS the endowments and I will have to cash these in to get the lump sum to put down...

I think I will have to arrange new life cover for the repayment mortgage.