Bit of a dilemma....

united4ever

Mortgage fix with natwest ends on 31st December. Currently have 140k left and on 2.99% (only started 2 years ago when we bought the house for 250k...maybe worth 290k now).

Natwest offered to switch to another 2 year fix of 2.54% (with no fees).

London & country said they were struggling to find anyone to remortgage us.

Our income is around 40k (have 2 young kids) and wife who just does a few hours part time on zero hours contract.

We owe about 5k over 2 credit 0% interest cards (no other debts).

I can pay off the credit cards in April when I get bonus which is fairly guaranteed. I think the credit card debt was the problem when I contacted L&C.

Should I just stick with current 2.99% mortgage until April and then go whole of the market or should I switch to Natwest 2.54% at end of Decemner?

One other thing...we are hoping to fund an extension but I suspect it's completey out of the question at this time.....woould need to increase mortgage from 140k to 210k to get what we want. Not going to happen is it? May have to wait a few years for that.

Any thoughts? Thanks in advance:)

Thanks a lot.

KRB2725

If your fixed rate ends in December, you would switch to the SVR between Jan and April and that will be higher than 2.99%.

Personally I would switch to the 2.54% then borrow additional funds for the extension when you feel you can afford it. You can borrow additional funds whenever you like, it doesn't have to tie up date wise with your existing fix coming to an end.

millkins

I'd say you'd be best off going for 2.54% and saving like crazy (and hoping the value of your property appreciates too) so you can afford the extension you want.

emmb

Hi
I have not looked at the current deals, but over the years it seems to me any mortgage deal with nil fees, even remortgsging is extremely rare!
Def worth considering.

I heard there are rates as low as 1.6% at the mo, but probably restrictions on LTV, your eligibility etc and their fees may be huge. Low rates are often hand in hand with high rates or short terms, thus costing more in long run.

What rate do you go onto after December/what is your provider's SMR?
Personally, when my last deal ended many years ago I was able to swap onto the BMR (think that's what it's called but since been scrapped) which was tracking the Bof E rate at +2% , and so chose not to swap onto a deal because it would have cost more overvthe years of the deal with the fees..and even now that rate is still competitive at 2.25% and have saved thousands in fees over the years.

united4ever

Doh! Didn't realise we would go up to SVR from January so yes, we are best taking some action, probably will go for the 2.54% with no fees then. There is a 2 year fix at 1.74% too but fees are £995....dont think there is much difference overall. Also five year fix available: No fee is 3.10% and £995 fee at 2.53%. Got stung on a 5 year fix at my last property (just before interest rates dropped heavily) so my general philosophy is that the best deals are generally shorter term but I accept nobody can be sure so there is risk.

I suppose I could look for a mortgage broker who may be able to get me something less than 2.54% but if L&C don't think so then maybe no point.

Thanks though....i shall take some action and not slip onto the svr.

getmore4less

2.54% or 1.74% for £995 fee over 2 years you need to crunch the numbers

the fee based is likely to save you at least £1k over 2 years on £140k

what's the full term/payment

united4ever

getmore4less wrote: »

2.54% or 1.74% for £995 fee over 2 years you need to crunch the numbers

the fee based is likely to save you at least £1k over 2 years on £140k

what's the full term/payment

Thanks, 19 years left...was 21 year mortgage at the start.

getmore4less

£140k 19 years 2.99% about £800pm

carry on paying that your two options in 2 years will have the following left over.

£140000 @ 2.54% £127,613
£140995 @ 1.74% £126,461

united4ever

getmore4less wrote: »

£140k 19 years 2.99% about £800pm

carry on paying that your two options in 2 years will have the following left over.

£140000 @ 2.54% £127,613
£140995 @ 1.74% £126,461

Thanks again...so its worth paying the fee then. I'll plan on paying the fee (added to mortgage sum) and take the lower rate then.

Thanks again

yessuz

very interesting - your LTV is like 50% and you cannot get the better deal than 2.5%?

my colleague, with much more expensive house (and of course - much higher overall income between him and his wife) switched from fixed to variable, at circa 1.5% or so, with 50% LTV.

united4ever

yessuz wrote: »

very interesting - your LTV is like 50% and you cannot get the better deal than 2.5%?

my colleague, with much more expensive house (and of course - much higher overall income between him and his wife) switched from fixed to variable, at circa 1.5% or so, with 50% LTV.

Yeah, might contact an independent mortgage advisor in the next few weeks and see if they can improve on the NatWest....think the 5k on cards is what is the problem. Also the 40k income is 32k basic plus 5k bonus (but fairly guaranteed) and 3k from a part time zero hour contract that I have done for the last year only. I guess if I just had 40k basic salary the banks would prefer that too.