End of fixed term mortgage

janet_oggy

Cheers KS...was advised by my step-dad to get Daily Mail yesterday and see what are the best current mortgage deals so I did, and the Co-op bank came up twice, so I went on their website last night, and their deals seem to be comparable to Santander.
What would you recommend ??

kingstreet

I wouldn't. It isn't appropriate without knowing your circumstances. You need to research the product you want and compare it to the customer retention products provided by your existing lender when your current offer is close to ending.

You need to look in a month or two when you approach the end of your fix.

Consider paying a fee. On a five year fix, you may find you get your money back by the savings you make on a lower rate product. There are products with low/moderate fees with rates around the 3.1% mark, which will save you £200 a year interest on a £60k mortgage.

The funding for lending scheme means rates may well be lower the further into 2013 we go as lenders need to fulfill their lending promises/targets to avoid penalties.

getmore4less

I though most lenders will happily give terms to 60/65 if you have a job, why mention you can retire early its an option for nearly everyone anyway.

What income would you have it you did take the pension early?

It might be enough to cover the mortgage on a longer term.

janet_oggy

Thanks again KS....our current lender - the Barnsley Building Society (aka Yorkshire Building Society) have said that they can't quote me yet as the existing mortgage deal still has more than 90 days to run (108 I think)...so I guess I will just have to wait until January and see what they offer.

GM4L...in my current job I can retire after 30 years service and my current projected deal is £130k+ lump sum and approx. 18k p.a. pension, so yes, there would be sufficient income to keep paying the mortgage, but I believe the advice is to pay off the mortgage a.s.a.p, which I could easily do with the lump sum.

dimbo61

I would check the T&C of your pension very carefully as most pension schemes now require you to work to 55.
You are younger than me so you will not get your state pension until you are 68 if not older.
Your pension and the lump sum will be very important when you do retire as you need this money to live on for perhaps 15 years before you get the state pension.
check what the follow on rate is with your current deal ?
Use " whatsthecost" website to work out the best deal for the loan you want.
Speak to a " whole of market mortgage broker" to see what is available.
If you have a good pension I guess you have a good steady job !
Lots of POOR pensioners still paying a mortgage well into retirement and living in poverty and not enjoying retirement in the sun

janet_oggy

Thanks Dimbo.... although the T&C's of Police pensions have recently changed, I am fortunate in that it only affects officers with more than 10 years left to serve (which obviously I don't), so I know I am okay on that front !!
As I have said above, I plan to retire from the police after 30 years service (at the age of 53), but I am not one for putting my feet up, and will be looking at getting another job then.

Not heard of the "Whatsthecost" site before, so will give that a try.

Going back to the Santander mortgage deals, the one that their mortgage advisor tried to flog me was the 2.99% fixed rate for 2 years deal, with no fees involved, which admittedly does sound pretty good to me (but what do I know !!), but with our circumstances being as they are, I was leaning more towards a 5 year deal. What are the thoughts on that ???????

getmore4less

http://www.whatsthecost.com/mortgage.aspx

with this you can work out just about anything you want if you play with the numbers.

remeberr by borrowing morre and reducing your payment with a longer term you are just borrowing money from your future(lump sum/income).

I would look at what you think you want the 10-15year tem with bi of extra borrowiing and aim for that, no need to initialy mention the early retirement option you have a job that you don't HAVE to retire from.

early retirement and paying it off is a the back up plan.

kingstreet

You need to consider your feelings towards rates and how they might change in the future. If you'll feel more comfortable with a longer term fix, that's what you should go for.

An employee of a lender will try to sell you the rate he/she thinks the lender is competitive in. He/she is not there to find you the deal which best suits your needs. Most supply information only and expect you to pick.

Closer to the time you will need it, study the offers of different lenders to establish what's right for you.

janet_oggy

GM4L...went to the

http://www.whatsthecost.com/mortgage.aspx

website and found it very useful thanks...I like the way it shows you the decreasing balance and actual amount paid off INCLUDING interest which the building society calculators don't... cheers for that, I think I will be using that when it comes time to choose !!


Kingstreet.... good advice indeed..having used the above calculator and played around with the numbers, I could now be more inclined to go for the 2 year fix at 2.99% over 10 years which will drop our current payment from £667 to £608 per month, and then look for a similar deal in 2 years time.

In the current stagnant economic climate is it the general consensus that interest rates are likely to remain low for some years to come ???

janet_oggy

Had a phone call this morning from above Santander mortgage advisor who said that the 2 year 2.99% fixed rate deal is finishing on Wednesday. In light of KS's comment above about the banks being encouraged to loan more, I am wondering if the rate might even be coming down ????
I asked said mortgage advisor if this could be the case, and she replied by saying that she didn't know :think::think: