Best date for remortgage to complete?

ror100

getmore4less wrote: »

You need to analyse long term
overall I think you are increasing the risk you will be paying more for most of the next 20 years



the best thing to mitigate risk is overpay

I am analysing long term. I really am not worried about being mortgage free within x years. I want to know what I am paying each month for as long as possible - that is what works for me.

The BOE base rate will go up. It only needs to raise by 0.75% for the tracker to then equal the rate at which I am fixing. 0.75% on the mortgage is the equivalent of around £40. If my finances every month were dependant on saving £40 I would argue that I'm really not the best person to have any financial commitments at all.

My question is:
If I complete on the 1st of August, does my first payment come in August or September? And would it include a capital repayment as well as interest?

When we got our first mortgage, we completed late in the month, paid the few days interest until the 1st, and then the first payment was capital, and interest.

We just want to make sure we pay capital on our first payment, not just a month full of interest (in my mind a waste of a payment).

(Incidentally, I know I could get a better rate by fixing for 2, 3 or 4 years, but that not right for me. I am doing what is right for me. Please remember that everybody is different, and our attitudes to money differ. I am sure that is a key part of why my other half and I both have credit scores of 999).

HappyMJ

You would have to ask the bank providing the mortgage to get the correct answer...we can only guess.

You do know can change the payment date to whatever date you want to and you do know you can pay whatever amount you want as long as it's more than the minimum. So instead of "wasting" a payment as you called it then just pay some more.

getmore4less

HappyMJ wrote: »

I would love to have a BR+1.99% mortgage fixed for life. I would never change that mortgage ever.

Risk averse? Invest the extra money you save into a savings account earning 3%. Free money with little effort.

I like the savings of £5,700 calculated earlier...any rate rise would have to be quite a lot to offset that hedge. The economy would not be able to cope with such high rate rises for at least 5 years and that's the term of your mortgage. I can see rates rising but not by much and very slowly over a long period.

Thats the key, fixing on a higher rate now for 5 years might be good for 5 years if rates do rise significantly(at least 1.5% which will cripple a lot of people) but also gaurantees(allthough margins may narrow a bit) you are on a higher rate for the next 15 after that.

Even Coventrys best deals on 65% LTV only get close to the rate

If their SVR has a 4% margin over base against 2% so if they only took 1/2 of a 2% base rise it would still be 1% more and that the margin the fixed deals are likely to have as well.


I don't get the logic of pay more to stop you worrying about paying more.

At least this deal has no fees so not £1k down to start with.
if the old 5.2% has been affordable then the NEED to fix is just not there.
get the lowest rate and overpay/save if better net rates.

getmore4less

ror100 wrote: »

My question is:
If I complete on the 1st of August, does my first payment come in August or September? And would it include a capital repayment as well as interest?

When we got our first mortgage, we completed late in the month, paid the few days interest until the 1st, and then the first payment was capital, and interest.

We just want to make sure we pay capital on our first payment, not just a month full of interest (in my mind a waste of a payment).

You should be asking your convayancer what the payments will be and when.

As I said before it makes no difference to the cost when you complete the interest starts accumulating daily(may get added daily or monthly you need to ask)

In reality all payments are off the amount owing,
The amount owing just goes up when the interest is added

There is never a wasted payment unless the lender keeps them back and does not credit then to the account.

Perhaps time to ask how overpayments work on this loan.

getmore4less

Have you checked the cashflow issue you can get switching.

Can you manage both payments in the same pay cycle?

If not the way round this is to borrow a bit more and overpay when the new mortgage settles into the payment cycle if you didn't need it all.

getmore4less

ror100 wrote: »

I am analysing long term. I really am not worried about being mortgage free within x years. I want to know what I am paying each month for as long as possible - that is what works for me.

The BOE base rate will go up. It only needs to raise by 0.75% for the tracker to then equal the rate at which I am fixing. 0.75% on the mortgage is the equivalent of around £40. If my finances every month were dependant on saving £40 I would argue that I'm really not the best person to have any financial commitments at all.

My question is:
If I complete on the 1st of August, does my first payment come in August or September? And would it include a capital repayment as well as interest?

When we got our first mortgage, we completed late in the month, paid the few days interest until the 1st, and then the first payment was capital, and interest.

We just want to make sure we pay capital on our first payment, not just a month full of interest (in my mind a waste of a payment).

(Incidentally, I know I could get a better rate by fixing for 2, 3 or 4 years, but that not right for me. I am doing what is right for me. Please remember that everybody is different, and our attitudes to money differ. I am sure that is a key part of why my other half and I both have credit scores of 999).

The max that can get out is paying one full capital payment(£365) a full month late will cost an extra £2 month to catch up if you don't make it right with an overpayment.

by chosing the 3.25% over the 2.45% it is costing you £77pm more in interest for the first year.