Post Office No Fee Mortgage Advice please.

Yanman

Well the first two years of paying a fixed rate mortgage have ended and we have moved on to the Woolwich SVR of 3.89%. I called Woolwich and the best they could offer me for a further two years was 3.28% with no fees on a 77% LTV. The thing is, if we could value the house at 4k more than I purchased it for two years ago then we would drop in to the 75% LTV and the rate would move to 2.39% with a £499 fee. However, the Woolwich mortgage advisor said her computer would not allow a change of house value and the offer had to be against the original purchase price. I said no thanks, I will move on.

To cut a long story relatively short I intend to apply for a remortgage through the Post Office on their 2 year Fix with no arrangement fee and valuation and legal fees paid by the lender at a rate of 2.58%. Obviously I would need this new deal to be at a 75% LTV. I currently have a mortgage of £116k and the purchase price of the house was £151k.

This seems to be a decent deal but any advice from the more knowledgeable folks on here would be great appreciated.

Thank you.

Yanman

Does it matter that the follow on rate is reasonably high 3.99% + BOE rate?


I suppose as long as I am on time with the next deal this doesn't matter?

Thrugelmir

Yanman wrote: »

To cut a long story relatively short I intend to apply for a remortgage through the Post Office on their 2 year Fix with no arrangement fee and valuation and legal fees paid by the lender at a rate of 2.58%. Obviously I would need this new deal to be at a 75% LTV. I currently have a mortgage of £116k and the purchase price of the house was £151k.

2% is a close margin to gamble with. Wait a couple of months perhaps.

Thrugelmir

Yanman wrote: »

Does it matter that the follow on rate is reasonably high 3.99% + BOE rate?


I suppose as long as I am on time with the next deal this doesn't matter?

Is a factor that should be considered. As not just current rate that matters. Over time the differential between lenders is bound to narrow. Making rate chasing less effective.

Yanman

Thanks for the response. Would it be reasonable though to say that although the house was valued and purchased at 151K two years ago the value is now higher so the LTV changes on the basis of this?


I was hoping to got direct to the Post Office, but am considering that I may need to engage a broker.

ethank

Don't think Post Office do business through brokers at present, but they are looking to change in the future.

jonathan_1983

Hi Yanman,

I was in a similar situation to you a few weeks back. I bought my house for £90,000 (repossession) just over two years ago and I had a 2 years fixed mortgage.

I looked at the Post Office and for me, they had the best rates but I wanted the 75% LTV even though I was at 87% at the end of March. I applied through the Post Office and put the estimated value of the house at £106,000 to get it to the 75%. I was a bit nervous about it but recently, 2 bedroom houses on my street were selling for that price and mine is a 3 bedroom house.

The forms are pretty straight forward online and as long as you send everything back on time that Bank of Ireland/solicitors send you then things move pretty quick. The valuation was also done quickly by a nice chap who was measuring everything in the house and garden! They valued it at £106,000 so I am very happy, paying 20% less than I was previously per month.

If you're organised and confident that the house value is where you say it is, I would say go for it. I honestly found the whole process quite easy and everyone I dealt with was spot on.

Hope that helps!