NW 5yr Fix 3.65% or Halifax 2yr Fix 2.99% ???

Sparx

So we are buying a new build with Redrow in December, ready to move in June 2014. We are using the HTB scheme; 5% deposit, 20% equity loan so we mortgage 75%.

The best 2 mortgages we can find (and the mortgage adviser) is Natwest's 5 year fix @ 3.65% then SVR 4% or the Halifax's 2 year fix @ 2.99% then SVR 3.99%..

Now Halifax looks good to me as it saves us approx £40 a month for 2 years. But of course no one knows what the housing market and interest rates will be look come mid 2016 if we took Halifax's 2 yr fix and then needed to re-fix.. Both have no product fees etc.

Natwest's 5 year fix @ 3.65% albeit means we pay £40 more a month, we have that stability for 5 years knowing it shall be what it is! But being a money saver, spending another £480 a year that I don't need too makes me cringe!!

Any suggestions guys?

kingstreet

I'm surprised there are no Nationwide offers under consideration?

ethank

I did the same with another developer and got 2.44% with Nationwide for two years. Just waiting to exchange!

Sparx

Do Nationwide accept Help to Buy mortgages (5% deposit, 20% gov equity loan) ??

If so, I'm with Nationwide for my bank account. I was initially going to use them, while their offers are competitive they do have higher upfront fees (see below)..

On the face of it, Nationwide's 2 year fix is the best but has a £499 upfront fee - we can afford it, but is it worth it?? Otherwise Halifax is next in line for the cheapest.. But with the housing market picking up, will the rates shoot up that we'd be better off with a 5 year fix with Natwest (no fees) or Nationwide (£499 upfront)??

Halifax - 2 year fix @ 2.99% - £458 p/mo - No fees
Natwest - 2 year fix @ 3.15% - £467 p/mo - No fees
Natwest - 5 year fix @ 3.65% - £497 p/mo - No fees
Nationwide - 2 year fix @ 2.34% - £421 p/mo - £499 upfront
Nationwide - 3 year fix @ 2.64% - £438 p/mo - £499 upfront
Nationwide - 5 year fix @ 3.34% - £479 p/mo - £499 upfront

amnblog

I think you should check the fees on the Halifax product again

kingstreet

Nationwide has a £99 upfront booking fee, but the £400 product fee can be added to loan. You can then pay it off after completion to stop it costing you too much in interest.

Yes, Nationwide is an HTB- EL Lender.

We do several HTB apps a week and most of it is going to Nationwide as overall, the deals are better than they are for the other lenders.

I thought Halifax was 2.74% with £999 fee or 3.04% with no fee?

Sparx

Product fee £0 ?

Does anyone have any actual advice for me then re which lender, 2/3/4/5 year fix, interest rates, etc?

EDIT:
Thanks kingstreet, I'm swaying towards the Nationwide mortgages as originally planned. I can get a flexclusive mortgage as well. Do you know if they have any issues with someone who is employed on a fixed term contract (partner was on 12 months, now signed for another 18 months with NHS)? I've been told Halifax and Natwest have OK'd it so should imagine NW are ok with it as well..

The NW flexclusive 4 year fix @ 2.94% looks good, £455 p/mo.

kingstreet

I'm not going to tell you what rate period to pick. Have no idea of your circumstances or feelings.

Going for a product with a fee is a function of the rate period and amount you are borrowing. A longer fix and higher mortgage amount would probably indicate paying a fee, while a shorter term and lower amount would normally suit a fee-free product.