Existing Deal Ending Soon - New Deal or ?

rscosworth

Guys,

I currently have a mortgage deal with the Halifax fixed at 5.69% which is costing me £700 per month.

House value is currently £155k and I have 112k remaining on the mortgage.

I intend on putting 8-12k into the mortgage to bring the LTV rate to 65%.

I have excellent credit rating and the £700 is more than affordable at the moment (however I would like this reduced as much as possible)

I have been looking at Tesco (2yr fixed 2.79% £195 product fee) which should bring my monthly payments to below £465)

Is this the most sensible thing to do? How can I work out what my monthly repayments will be if I move onto the variable rate?

FYI - Mortgage is not due till June but would like to get a head start on it.

FYI - This is a single mortgage application, not joint
FYI - This is in Scotland

Thanks

kingstreet

Use a mortgage calculator.

Amount outstanding, remaining term and mortgage rate are what you'll need.

rscosworth

kingstreet wrote: »

Use a mortgage calculator.

Amount outstanding, remaining term and mortgage rate are what you'll need.

Thanks, so by my reckoning Halifax Variable Rate is 3,99% currently, giving me a monthly payment of approx £570

Crashandburn

rscosworth wrote: »

I have excellent credit rating and the £700 is more than affordable at the moment (however I would like this reduced as much as possible)

Interesting view.

I personally would look to make the most of the saving from 5.69% to say 2.79% and eat into the term. Keep paying the £700 per month, which is more than affordable as you say, and see how much you can reduce the term by.

On the figures mentioned, you may be closer to a 16 year term than a 22 year one.

Good luck

rscosworth

Crashandburn wrote: »

Interesting view.

I personally would look to make the most of the saving from 5.69% to say 2.79% and eat into the term. Keep paying the £700 per month, which is more than affordable as you say, and see how much you can reduce the term by.

On the figures mentioned, you may be closer to a 16 year term than a 22 year one.

Good luck

That is interesting actually, when I say affordable I do have no debt, nothing on credit/store cards and 12k available to put into a mortgage.

That said, since taking the mortgage on myself (used to be a joint mortgage) I have made sacrifices (sold motorbike) so I probably was in the mindset of having some money to save/spend and perhaps get a holiday a year.

I could, I suppose get something in between (£550-600) which could give me the best of both worlds, shorter term and some money in my pocket.

Hmmm

dotdash79

Or look for a product that will allow you to overpay, get the lower payments and then the months you can overpay.

If you need the money one month it won't be too bad.

geewhiz

Or keep paying the £700 but at 2.79%, reduce the term and use some of your lump sum to replace the motorbike!

rscosworth

geewhiz wrote: »

Or keep paying the £700 but at 2.79%, reduce the term and use some of your lump sum to replace the motorbike!

I have no intention of replacing the motorbike in the next 5yrs but would like to go on a holiday of some sort.

The lump sum is to bring the LTV below 65% to enable me to get the 2.79% deal, it will certainly make more money this way than in the ISA I have it in at the moment.

Thanks

Thrugelmir

rscosworth wrote: »

I have been looking at Tesco (2yr fixed 2.79% £195 product fee) which should bring my monthly payments to below £465)

How many years left on your mortgage term?

rscosworth

Thrugelmir wrote: »

How many years left on your mortgage term?

25yrs left on the 30th June 2013

Thrugelmir

Downside of your plan is Tescos reverts to SVR of 4.24%. Above HBOS at 3.99%.

So maybe worth seeing what HBOS will offer you as well.

As remortgaging to a new lender can incur sizable fees if not part of the mew mortgage offer.