Some quick mortgage Qs from a FTB

chamelious

My GF and i just had an offer accepted on what will be our first house (hurray!). She works in a bank and so does my brothers GF (her boss, the bank manager) and i'm pretty savvy at this point (i think) so i'm trying to avoid using a broker to save some pennies.

Everything about our situation is standard, 10% deposit, 2 salaries, amount we're borrowing is almost half what the bank calculators say they "would" loan us.

I'm simply trying to get us a mortgage with a competitive rate (looks like 1.9-3% ish at the moment), is possible without sky high fees. This is question one, what "benefits" to mortgages am i missing, i feel like i MUST be as some of them have SUCH high fee's associated (1.5-2k), and i can't see why. At this point im not really concerned with the ability to overpay or repay early.

Question 2, as a case study HSBC have a "2 Year Fixed Fee Saver" option with no fee, and a 2.39% rate. This looks like a no brainer to me, which makes me feel like im missing something?!

https://www.hsbc.co.uk/1/2/mortgages/products?pcode=A004046926000000000000000000

Many thanks

lee111s

High fee's often mean a lower interest rate, you need to do the calculations for your own situation such as borrowing amount and inital deal length to determine if it's cheaper to pay the up front fee or have a slightly higher monthly payment. Usually unless you're borrowing a very high amount, fee free deals work out cheaper.

Hopefully that answers both questions

chamelious

Ahh of course i failed to consider the fact that we're borrowing a relatively low amount really. Thanks that helps

kingstreet

If you extend that logic, you often find the products/lenders who charge no product fee, no valuation fee and pay a cashback on completion will offer better overall value than the lowest rate products and possibly "fee savers".

That's broker thinking for you.

chamelious

Thanks. I haven't yet come across a mortgage that offers cashback.

chamelious

Could anyone take a quick look at this for me? Seems good to me.

http://www.ybs.co.uk/mortgages/product.html?id=26131

elverson

You can get 5 year fixed mortgages too if you are happy to commit to that long.

Have you got enough to pay your own solicitor costs, stamp duty and removals, as these can't be added to the mortgage?

chamelious

Thanks. The 5 year ones interest rates are significantly higher.

Yes to solicitor fees. There is no stamp duty or removal to be done fortunately.

Dird

chamelious wrote: »

Could anyone take a quick look at this for me? Seems good to me.
http://www.ybs.co.uk/mortgages/product.html?id=26131

Just look at MSE for the cheapest, sorted by Total Cost Assessment: here with your info

Accord is cheapest 2 year. I hope you've lived together beforehand quite a bit; high school friend decided to buy last year with his long term girlfriend, first time living together, she's now buying out his share & he has replaced her. Messy

chamelious

Thanks. We've lived together about 5 years with no issues.

kingstreet

Accord is cheapest 2 year

Bargepole job!

5.54% standard variable if they won't give you a retention product or if you are a mortgage prisoner unable to remortgage elsewhere due to a change of circumstances.

Nationwide is £7.25 a month more expensive but SVR is 3.74%, has a commitment to always offer products as good to existing borrowers as it does to new borrowers.

32 years and counting and never done business with Accord.

Not recommending OP uses any lender, merely providing points of comparison when only initial/short-term cost is considered in selecting a mortgage/lender.