Choosing a mortgage

squeeks

I am getting a little bamboozled by mortgages. I am seeing a financial advisor tomorrow, but I am trying to have some idea about what I want before I get reams of numbers and put on the spot to make a decision.

At the moment I am pretty sure I don't want any of the short term fixes (2 years and under) as the rates are likely to rumble around the current value within that time frame, but I might be surprised.

A 20 year fixed also appears to be quite good, but in the short term it is relatively expensive compared to other options - close to double the interest rate. But still, that isn't really high.

I really like the idea of offset mortgages but the ones I can find have a reasonable short term rate, but the standard variable rate when that finishes looks a little ugly (but still affordable) as the svr is currently higher than the 20 year fixed rate. The offset would save me several '000 in those two years on the rate, that can be immediately offset against the mortgage.

Any thoughts out there?

Let_Us_See

squeeks wrote: »

Any thoughts out there?

Yes, you are all over the place. Discuss options with the adviser and you should never be "put on the spot to make a decision."

PS. Are you seriously considering a 20 year fixed rate? If you have to ask why not, you need an adviser.

kingstreet

Brokers don't just chuck a load of quotes on the desk and say "pick one" that's what lenders had been doing for years until April 2014 when they suddenly found themselves giving advice.

Hence a lender mortgage appointment is now over two hours long.

A decent broker will ask you questions, gaining both hard and soft facts. These lead the broker to make suggestions which appear to suit how you feel about things - savings, future rates, how you feel about paying more and so forth.

Let's say you think you'll have £20k in savings after your new mortgage completes and you feel that you would prefer to avoid future rate rises and have payment certainty until your child reaches age five.

The broker would then probably recommend something like a fixed rate offset product for the period that would cover.

It's not just about the odd 0.1% on the rate. The job is about matching lender to borrower and product to need and circumstances. You should feel confident you have the right mortgage for you before you apply.

Banana2014

Kingstreet I have PM you.