remortgage or new deal

romanian_bird

Hi. I'm currently pondering whether to switch to a new fixed rate deal with same lender OR re-mortgage to find a better fixed deal with another lender. I'll probably need a broker to help in either scenario. Would anyone be so kind to tell me how much a broker fee would be for this: 1. switching to new deals or 2. finding a new mortgage? I'm not looking for exact figures, but some ranges would be very helpful - either % of the mortgage amount or actual £ ranges. Thank you.

Maelwys

romanian_bird wrote: »

Hi. I'm currently pondering whether to switch to a new fixed rate deal with same lender OR re-mortgage to find a better fixed deal with another lender. I'll probably need a broker to help in either scenario. Would anyone be so kind to tell me how much a broker fee would be for this: 1. switching to new deals or 2. finding a new mortgage? I'm not looking for exact figures, but some ranges would be very helpful - either % of the mortgage amount or actual £ ranges. Thank you.

Did you check the guide?
You might get a few other replies with more specific fees.

I'd suggest having a look yourself using a comparison tool (such as https://www.moneysavingexpert.com/mortgages/best-buys/ ) and then decide whether you want to involve a broker.

If it's just going to be a straightforward deal swap then you may not need any outside assistance at all... but if your circumstances have changed or there are other complications, then a good independent broker can eliminate a lot of the hassle for you.

Last time my mortgage fixed period was up for renewal, I just went with the same lender and didn't involve a broker other than a quick visit to make sure that I'd already found the best deal.

romanian_bird

Thanks for the link. My circumstances have changed a bit, and also lenders changed the way they grant mortgages in April 2014, that is why I'm now considering a broker.

I've never used a broker before and I'm confused with re: to the fees they might charge. For instance, if a broker helps me switch to a new rate, they get a commission from the lender, but do I have to pay them anything myself? and if yes, roughly how much. (same story for remortgage, how much would I have to pay).

amnblog

A switch to a new rate from your current lender may mean zero fees from the Lender to your broker. Therefore anything earned will have to be paid by you.

romanian_bird

Thank you @amnblog, any idea about a range for those fees that I would have to pay? And is it a percentage of the mortage amount? Or is it a fixed fee - and if yes, any idea about how much.

Also, I'm even more confused now, I read that Halifax - my current lender - pays a commission to the brokers for these switches, am I wrong?

amnblog

Yes, Halifax does pay a fee to the Broker for a rate switch.


That is an example of a Lender were we can usually arrange a rate switch with the Lender's commission sufficient that we do not need to charge the client a broker fee.

romanian_bird

Thanks, that's great to know. So am I correct to assume that in a simple switch case, meaning no changes - term stays the same, mortgage amount stays the same - I should be able to find a broker who wouldn't charge me any fees for this switch?

How about the remortgage, is there a guide on broker fees somewhere? Just to put things in context I'm looking for approx £200K at 60% LTV with a very clean credit history. However, affordability might be an issue due to levels of credit card debt and childcare costs - I'm not entirely sure as online calculators results vary widely, some say unaffordable, some say affordable.

amnblog

We would do both the switch or the re-mortgage without charging a fee - so yes - I suspect we are not unique - you would not need to pay with the right broker.

getmore4less

You don't say whta rate your have or will be on if you have a deal ending.

Thats your starting point.

Then look at the retention deals with the current lender

These will be the benchmark for anything better that involves more effort.

romanian_bird

Deal ending soon yes, I don't want to pay ERC so I need to wait for another month or so. I'm on 2.64% now, and variable is 3.99%.

Halifax website says 1.69% for a new 2-year rate at 60% LTV so I'm guessing that would be the "worst" case scenario involving no fees whatsoever.

getmore4less

romanian_bird wrote: »

Deal ending soon yes, I don't want to pay ERC so I need to wait for another month or so. I'm on 2.64% now, and variable is 3.99%.

Halifax website says 1.69% for a new 2-year rate at 60% LTV so I'm guessing that would be the "worst" case scenario involving no fees whatsoever.

Chances are it is the best(good enough) case already for 2 year deals.

Why 2 against longer fix or a good tracker.

planning to overpay?
best protection against rate rises is lower debt
or the ability to lower it by saving at a better rate.