Should I remortgage if I am looking to sell in 1-2 years?

Smith15

Hi All,

I am going to seek some advice prior to my mortgage deal ending in December but wanted to get some ideas before hand as I am organisation freak!

I currently have a mortgage LTV of 90% that's in a 2 year fixed deal, this is running out in December 2015.

Based on current valuations if I remortgage my LTV would change to 75% due to market changes and what I have paid off during the 2 years.

I am looking to sell and buy another property but this could be any time between the next 1-2 years. I am not sure whether it is worth remortgaging when my current deal finishes as my montly repayments will be lower by approx £200 (from quick estimates I have looked at) meaning I can save that extra money towards a new property.

However, if I look to sell before the 2 years you generally have to pay an early exit fee on fixed morgtage rates is that right? Also, are there any complications to remortgaging that I should be aware of?

Any ideas would be great

Thanks so much!

betmunch

Get a product without Early Repayment Fees?


Also, you could get a portable product, but that's not guaranteed so could lead to problems later on.

Smith15

Thanks for your response. I have been looking and most fixed term ones have an exit fee or if they don't they are more expensive monthly

lee111s

You can't have it all! You can get cheap, fixed and ERC's. Fixed, more expensive and no ERC.


OR, you could go for a tracker which often have no repayment penalties and give the most flexibility BUT you have to understand that the BOE base rate is rumoured to go up in the next year or so. Probably only .25% to start with but no one knows when or by how much. Of course it may not go change for another 2 years.


How much would rates have to rise before you were any worse off if you were on a tracker at say 1.69% above base?

Smith15

Hahaa I know sadly can't have it all! Going to do some numbers and see, if I save more on my monthly payments than the EPC then that's all that matters. Yes I heard about the rates due to go up, shall have to do some calcs ☺️

dimbo61

I would start by looking on your existing lenders website to see what they have available for existing customers.
Now YOU think you will have a LTV of 75% which is some going from 90% only 2 years ago so a HUGE Well Done if your lender values your home at 75% LTV.
You can normally secure a new deal upto 3 months before the old one finishes.
Your existing lender WILL NOT offer advice without a full fact find but you may be able to apply online if just swopping to a new deal.
If you plan on moving in 12/24 months then maybe a tracker deal

Smith15

Thanks for your response. I will check out with my current lender. Your right the LTV is based on a a few recent sales of the same property in my build but obviously when I remortgage I'm guessing they will do a whole valuation etc so could be between 75-78%

Thanks