Switching rate rather than remortgaging - experiences please

gtt184

Hi,

Our fixed rate with Halifax is due to end soon.

Online, it says it's really simple to do!

Anyone had any experiences of switching rates with their lenders?

We really don't fancy going through a whole new mortgage application and remortgaging as it seems to costly when we can just ''switch' rates.

What do you think?

Do lots of people stay with the same lender and just keep switching rates? I've never thought of doing this before!

kingstreet

It's called a product transfer.

The Halifax system stores an indexed valuation based on house price inflation in the area so you will benefit from a lower loan to value.

Have a look what's available. The products aren't normally market leaders. Products upto 75% LTV are being replaced tomorrow and the rates are being reduced.

gtt184

Thanks Kingstreet. I assume you don't need to get bank statements and payslips and all of that either? Sounds like much less hassle!

kingstreet

Nope. It's execution only as long as you don't involve a human being and there are no status or affordability checks.

Glover1862

I did it with Co-op over the phone, 5 minutes, online should be even quicker

nicholbb

Should be quicker but I did it a couple of days ago and will be reviewed between 1st and 5th but might be to do with the rate reductions - which may or may not be of use for me.

amnblog

It gets complicated if your mortgage runs into retirement or has an interest only element.

WrS

Hi,

Sorry for jumping into this thread for one question of mine which may be relevant to OP too.

Halifax overpayment allowance is 10% of the reducing balance for each calendar year i.e. from 1st Jan until 31st Dec. When you switch a fixed product with Halifax midway a calendar year, does your 10% overpayment allowance resets or remain the same? For example, if you have already overpaid the full 10% allowance for year 2017 in Jan 2017 and you make a product switch in Jun 2017, would you get a new 10% overpayment allowance with the new fixed product for the remainder of 2017 OR you will have to wait until Jan 2018 to be able to overpay again without incurring early repayment charge?

nicholbb

If you were in this position you would just pay your 10%, wait till your current fix ended pay as much as you like then start a new fix.

I suspect but don't know, that it's just 10% in a year - because the 10% you can pay off is the loan value from 1st of Jan.

WrS

Thanks for your reply.

Going onto SVR is one option. But can I do like this:

Fix ending on 30-Jun
Pay as much as can on 01-Jul
Then switch to another fix from 02-Jul?

Does Halifax allow to move to the new product from 02-Jul or will the new product will only start from the 1st of next month I.e. 01-Aug?

nicholbb

Yes starts from the next months payment, think you would have a couple of weeks to get the switch sorted, the advantage is your LTV could be a lot lower giving you better rates.