Can i do this? What would you do?

Ivrytwr3

Hey all,

We bought a property in 2005 and were on a 5 year fixed - this expired in Dec 2010.

We then sold that property and bought another in Oct 2010 at a higher price. We ported that mortgage and got another to cover the full price of the property at 85% LTV.

So we now have 2 x mortgages for the same property (with me so far?!) We have been overpaying £100 per month and have been able to make lump sum overpayments of about £20K

Loan Amount: £145,562

Repayment Term: 25 years.
Repayment Method: Repayment
Purchase Price: £171,250

Thismortgage is provided by Alliance & Leicester plc.

Part 1 of 2

Loan Amount: £69,955.00
Repayment Term: 25 years
Repayment Method: Repayment
Initial Rate Payable: 4.24%
Product Description: Porting Lifetime Tracker
The Base Rate Tracker rate is a variable rate which is 3.74% above the Bank of England base rate,
currently 0.50%, for the remaining term to give a current rate payable of 4.24%.

Part 2 of 2

Loan Amount: £75,607.00
Repayment Term: 19 years
Repayment Method: Repayment
Initial Rate Payable: 4.54%
Product Description: 5 Year Fixed Rate
The fixed rate will be 4.54% and will end after 3 months. (Fixed until 31st December 2010.)
When the fixed rate period expires we will charge interest on the money you owe us at
the following Base Rate Tracker rate, which is a variable rate which is 0.75% above the Bank of
England base rate, currently 0.50%, for the remaining term to give a current rate payable of 1.25%.

We think we are better off fixing Part 1 the mortgage for at least 3yrs.

Someone has advised Santander fix 3 year at 2.69% no fees at 60% LTV - but i cannot see this on their website and a google search doesn't throw this one up either.

Am i able to switch Part 1 from Alliance to Santander? (same company now) Or what you would do in our situation?

kingstreet

Ask your lender what your options are.

If you wish to opt for a fixed rate, you need to know what options are available to you. Only your lender can tell you what it will offer you.

They don't publish customer retention products on the intermediary website and I suspect they don't do so on the retail site either. They are too fond of picking and choosing what deal they want to offer to particular types of borrower.

Ivrytwr3

As a mortgage advisor would you advise staying as i am or moving Part 1 to a fixed?

kingstreet

I'm not your advisor and do not know your circumstances. You need to select what you believe is right for you, or seek advice yourself.

Ivrytwr3

I thought it was pretty simple - lower rate guaranteed for at least 3 years = lower payments = i can overpay = mortgage term reduces quicker.

I guess it isn't that simple?

holly_hobby

You only have 1 mortgage on your property, which is effectively split into 2 separate accounts.

This means that you can't move only part of your mge to another provider (ie the amount of borrowings in account 1, to which your ported product applied), but its all or nothing (and is to do with 1st charge requirements of the lender), so it would be the entire mge that would be moved to Santander and placed under the fixed rate (or whatever product you choose).

In the first place, and as suggested, see what A&L rates are available to you, if you do consider moving, don't forget to factor in the associated remortgage costs (inc any ERCs on part 2) to determine if there really is a saving to be had by remortgaging to an alternative provider such as Santander.

Hope this helps

Holly

kingstreet

That's as maybe. However, this is a regulated activity and if I was to advise on the different rate options, I would first be required to satisfy the know your customer rules.

Ivrytwr3

Holly, as you saw the mortgage is with A&L, now Santander. Could i still move Part 1 of the mortgage to them, or is it as you say "all or nothing"?

I will call them when open, just curious!

Ivrytwr3

kingstreet wrote: »

That's as maybe. However, this is a regulated activity and if I was to advise on the different rate options, I would first be required to satisfy the know your customer rules.

Completely understand, as above i will call them, i was just curious and wished to gauge the general feeing of others.

holly_hobby

The entire 1st charge mortgage on your property must be with 1 lender, although there may be several lenders within 1 group, they each have their own lending book and accounting.

If you think of the LLoyds Bankng group, they consist of Halifax, Birmingham Midshires, Bank Of Scotland and others .... but each lender indpendently market their own products.

Hope this helps

Holly

kingstreet

AFAIK Santander has separate retention products for A&L borrowers, Abbey borrowers and Santander borrowers. The only way to get this confirmed is to speak to the lender though.