mortgages - where now

sthomas150_2

Hello all and many thanks for your time.

I have a residential property worth ~£225k. this has the three following mortgages on it:

mortgage 1 65k fixed 2.57% until 2020
mortgage 2 55k variable 0.95% over base rate (currently 1.2%)
mortgage 3 25k variable 1.49% over base rate (currently 1.74%)
LTV is around 60%

I know I'm fortunate to have these low variable rates - my question is should I stick with these in the long term or should I look at long term fixed rates before they start to disappear and potentially never return?

I'm with Woolwich so would probably stick with them (as mortgage 1 is fixed with them)- looking at their rates I could get a 7 year fix for 2.19% or 5 year fixed for 1.89% (both with £999 fees)

any advice always gratefully appreciated

Scott

amnblog

Hi Scott


Woolwich will always have fixed rates available to you. Very few clients seems to be keen to come off of rates under 2%.


The Barclays rates you quote are now out of date.


You can get 5 year fixed at 1.98% with £499 fee or £1.83% with £1,499 fee.


7 year rates start at 2.18%

ACG

Im not sure I would be paying a £999 fee on an £80k balance (assuming you only have to pay the £999 once for the 2 smaller parts).

try not to get sucked in by the rates, look at the overall deal.

getmore4less

With the two variable rates being so low you will struggle to better them except very short term and only if rates rise, also fees will eat into any savings.

mortgage 2 55k variable 0.95% over base rate (currently 1.2%) (£55pm)
mortgage 3 25k variable 1.49% over base rate (currently 1.74%) (£36.25pm)
base rate total
0.25 £91.25
0.50 £107.92
0.75 £124.13
1.00 £141.26
or
£80500 @ 1.98% 5y. I/O £132.82pm

those are the interest only, repayment and the numbers favor the lower rate to start and you need 3 rises before you start losing money and it will be 4 rises quite quickly as the initial £40pm lower cost does it's work.

..........

It's all about the fix.

throw as much as that as you can, do not overpay the other parts.

singhini

sthomas150 wrote: »

I have a residential property worth ~£225k. this has the three following mortgages on it:

mortgage 1 65k fixed 2.57% until 2020
mortgage 2 55k variable 0.95% over base rate (currently 1.2%)
mortgage 3 25k variable 1.49% over base rate (currently 1.74%)
LTV is around 60%
advice always gratefully appreciated

Scott

I'm no expert so ignore what I have to say but If I have worked this out correctly, you are currently borrowing £145,000 at various rates of interest. this equates to £65k representing 45% of the loan + £55k representing 38% of the loan and £25k representing 17% of the loan. Therefore wouldn't that mean your current rate of interest is 1.92% (2.57% x 45% + 1.20% x 38% + 1.74% x 17%)

So if your trying to look at fixing, should you be trying to fix at around 1.92% otherwise if you fixed for say 2.5% you in theory are fixing for a higher rate and there's no guarantee the rates will go up (they could take 3 years to increase and that would mean you fixed for a higher rate and have been paying more).

I cant work out what the right thing to do is (what I would do is try to reduce the £65k @ 2.57% debt by making overpayments if you can. I'm assuming any spare money wont be earning you anywhere like 2.57%).