0.68% + 2.35% should I re-mortgage?

BAK68

I took out an interest only mortgage 5 years ago and was wondering if it is a good time to re-mortgage now to start paying off the mortgage?

The base rate is 0.68% + 2.35% a total of 3.03% which makes my monthly payments of £287.90

Property Mortgaged for 113,850 and the current property value is 140,000

kingstreet

Why not just make voluntary capital repayments when you prefer?

Tying yourself to a repayment mortgage over a fixed term, means paying the same amount, convenient or not.

If you want to move for a better rate, that's a different issue.

BAK68

Thanks Kingstreet - voluntary capital repayments? do you mean make additional payments on top off what I already pay?

Morgage_Confused

Just to give you a rough idea...

At your interest rate 3.03% a 25 year repayment mortgage would be £541 per month. Why dont you just start paying that amount or higher.
Bear in mind the base will go up at some point though.


Just a side note....are you sure your rate isnt...2.53 plus base 0.5 to get 3.03

vectistim

Morgage_Confused wrote: »

Just a side note....are you sure your rate isnt...2.53 plus base 0.5 to get 3.03

I would guess its LIBOR rather than base rate.

kidmugsy

You'd want to check with the bank whether they are happy to accept all overpayments, or whether there's a cap on the amount they'll accept annually. Also check whether there's a most beneficial way for you to time the payments. Lastly, check whether you can later withdraw any overpayments you've made: if they allow that then you have a wonderfully flexible savings tool in your hands.