Time to Remortgage

moneypuddle

My OH and I have been in our house for 2 years in May 2013, and its time to remortgage. We had a bad deal first time round.

Details are as follows:
Purchased house: May 2011
Purchase price: £185,000
Mortgage Value: £157,000
LTV = 85%
Deal: Fixed for 2 years at 5.09% with Santander
Payment: £816/month (on top of this we also pay £53/month to Payment Shield to ensure our mortgage is covered should we lose our jobs). Of the £816 about £140 is repayment and the rest is interest, so I estimate we have about £153,500 still outstanding (new LTV of 83%)

I'm now on maternity leave, and its time to negotiate a new deal from May 2013 onwards. I am so clueless about mortgages but really want a good deal (it could effect whether I need to return to work or not, or at least how soon).

We have a IFA but I am under the impression we would sign us up to something just to get the most commission and doesn't have our best interests at heart at all. I'm looking to find someone else, and have just ordered the MSE Guide to remortgaging so I can do a little more research, but just wondered if anyone could tell me any decent deals based on the info above. Two of my friends have just signed up with HSBC, but when I searched their mortgage calculators, it seemed we would still be paying around £720/month on some of their deals and I was hoping for less

Thanks for any help

kingstreet

Is your partner's income enough to justify the mortgage alone?

What's the property likely to be worth now?

ACG

If your not happy with your advisor you can always try to find another. See if any of your friends or amily have any recommendations or try google?
Advisors arnt allowed to recommend on commission alone - thats not to say it doesnt happen as im sure it does but to be honest commission on mortgages are relatively the same there isnt a huge difference in it.

You could ask Santander what they have to offer you, then see what your advisor or a new advisor can do? Although i think at 5 months off, you may be a little too early.

moneypuddle

Hi Kingstreet. I think between £185,000 and £190,000 now

Hi ACG. Yeah as I said we're looking to find a new IFA, but as for being early - we were told to start looking 6 months before as deals can be held for 6 months

Do you know how it works with maternity pay? If we move to a new lender will they want to see payslips etc? My pay is about a third of what it usually is with me being on maternity leave, but would that affect an application?

Thanks

Jimbo1976

The valuation of your property will be a key issue. How confident are you of its value? You need to look at property portals such as rightmove and zoopla to check local sold prices. Do not go on "for sale" prices as these are irrelevant. At your loan to value, whether you are at 84%, 85%, 90% or 91% will play a huge role in whether or not it is worth remortgaging.

Why do you think you had a bad deal to start with? Whilst your IFA would have received some commission (its called a procuration fee on mortgages) from the lender, almost all of the mainstream lenders tend to pay IFAs and mortgage brokers the same amount. So it is extremely unlikely that you would have been sold a Santander mortgage for commission reasons alone. If you had been sold an sub prime mortgage when you did not have any credit issues or complications then I can understand you feeling angry.

Your IFA would have carried out a fact find before recommending the mortgage and your responses to this would have dictated what sort of mortgage they recommended and why. Some brokers send out a a justification or suitability letter explaining what they have sold and why.