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Nationwide mortgage - moving house - interest rate cuts
ghost08
Posts: 4 Newbie
Hi.
We are about to submit our application for a new mortgage for a house move. We owe £100,000 on Nationwide's BMR and our payments will now reduce by about £25 due to the interest rate cut.
We need to borrow £300,000 to move on a 80% ltv. We have a decision in principle and have submitted all paperwork. We were about to press go on the application yesterday and interest rates were cut.
We were going to apply for a 5 year fixed concerned that interest rates may rise. However, with the cut in rates a 2 year tracker seems more attractive even at current rates because of the scope to be able to afford any rises. The difference in payments is £150 a month and may be more if the base rate is passed on in some form. Our concern has always been certainty which means a fix but a 2 year tracker seems attractive. There is no early repayment charge as far as I can tell so as long as we keep an eye on interest rates and mortgage rates we could always remortgage within the next 2 years if rates start to rise. We would save money even with 2 application fees. My only worry would be that rates rise dramatically for some reason before we could fix and we would end up paying more than if we had fixed for 5 years but I really can't see that happening but who knows?!
So my questions are:
1. Does anyone know if and how quickly the interest rate cuts would be reflected in new fixed rates as that may be an option? Nationwide are for their members so I would hope so!
2. If Nationwide offer tracker products now will they automatically reflect the new base rate or will they be withdrawn i.e. We are looking at the tracker which is base + 1.04%. Will that just become base + 1.29%.
3. If we applied today could we change the product before we complete the process if rates do change?
Should we fix or go for a tracker and apply now or wait a few weeks? We have some flexibility with our timescales but not much!
Hopefully I have explained it right! Thanks
We are about to submit our application for a new mortgage for a house move. We owe £100,000 on Nationwide's BMR and our payments will now reduce by about £25 due to the interest rate cut.
We need to borrow £300,000 to move on a 80% ltv. We have a decision in principle and have submitted all paperwork. We were about to press go on the application yesterday and interest rates were cut.
We were going to apply for a 5 year fixed concerned that interest rates may rise. However, with the cut in rates a 2 year tracker seems more attractive even at current rates because of the scope to be able to afford any rises. The difference in payments is £150 a month and may be more if the base rate is passed on in some form. Our concern has always been certainty which means a fix but a 2 year tracker seems attractive. There is no early repayment charge as far as I can tell so as long as we keep an eye on interest rates and mortgage rates we could always remortgage within the next 2 years if rates start to rise. We would save money even with 2 application fees. My only worry would be that rates rise dramatically for some reason before we could fix and we would end up paying more than if we had fixed for 5 years but I really can't see that happening but who knows?!
So my questions are:
1. Does anyone know if and how quickly the interest rate cuts would be reflected in new fixed rates as that may be an option? Nationwide are for their members so I would hope so!
2. If Nationwide offer tracker products now will they automatically reflect the new base rate or will they be withdrawn i.e. We are looking at the tracker which is base + 1.04%. Will that just become base + 1.29%.
3. If we applied today could we change the product before we complete the process if rates do change?
Should we fix or go for a tracker and apply now or wait a few weeks? We have some flexibility with our timescales but not much!
Hopefully I have explained it right! Thanks
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