no fee/high interest vs fee/ lower interest ?

swayzak

hi

We are about to move up the property ladder and more than double our borrowing.

Obviously there is a balance with these 2 options.

Our 5 year discount is coming to an end.

What factor(s) should influence which mortgage we take next ?

I would invisage maybe overpaying a bit (the odd grand here and there) but probably not enough to justify an offset mortgage.

Would I be better taking a higher interest rate without the £400 plus arrangement fee ?

Would I see immediate benefits following an overpayment ?

thanks

swayzak

KTF

You need to speak to a broker or put together a spreadsheet that lets you compare the different deals. As you have said the no fee ones are not always the cheapest but unless you crunch the numbers you wont know. A broker will be able to show you the calculations though.

homer_j_3

they key will be the difference in payments. Can you save the arrangement fee over the benefit period (the period in which you do not pay the lenders variable rate)?

absolutebounder

Take the high fee with a bit of luck someone here will work out a way of claiming it back for you