Woolwich Mortgage Advice Please?

too_much_debt

Hi

Our fixed rate of 4.19% has finished and we are being moved onto the Lifetime Tracker SVR of 1.99% + 0.5% BBR = 2.49%. This is part interest, part repayment.

Payments will be £810 a month, mortgage outstanding is £147,000 property value about £240,000.

We rang up today and was told about Fixed Rates

2 Years Fixed 2.49% = £810 a month (reverting to Tracker at 3.49%)

5 Years Fixed 2.99% = £846 a month

If we go with the SVR will the payments stay at £810 or do they decrease as we pay off more of the mortgage.

Does anyone have any advice on which deal is best please as we are confused.

Thanks in advance for any replies.

TMD

kingstreet

too_much_debt wrote: »

If we go with the SVR will the payments stay at £810 or do they decrease as we pay off more of the mortgage.

Payments are designed to stay the same and will only change as rates change. This ensures the mortgage is repaid by the end of the term.

If part of the mortgage is interest-only, you'll need a strategy to repay this, as this amount is constant throughout.

amnblog

Make sure you want/need the security of the fixed rate before you take one.

The 3.49% (reversion rate) after the fixed rate is a lot higher than the lifetime tracker you are being offered now.

too_much_debt

Thanks Kingstreet

It is not interest only, it's repayment but the monthly payment covers interest and some of the capital.

We are just not sure whether to stick with the lifetime tracker rate of 2.49% or go for one of the Fixed Rates, the guy said that the offer of 1.99% is only until the end of the month.

kingstreet

So it's a repayment mortgage, it's not part repayment, part interest-only?

I misinterpreted what you said in your opening post.

The information concerning the repayment mortgage is still good. The monthly payment is designed to remain constant to repay the mortgage by the end of the term. In the early years you are paying mostly interest, later you pay mostly capital back as the amount you owe reduces.

too_much_debt

Thanks amnblog

This is what we are thinking, would we be silly not to take the Lifetime Tracker.

(sorry do not seem to have a Thanks button at the moment so cannot thank your post at the moment).

amnblog

thank me later