First Post - Advice on Re-mortgage

tjqm5

Hi guys,

This is my first post, I was looking for some help.

I joined HSBC on a five year fix with a rather high interest rate and I'm looking to find out how much I would save by taking up a new deal and making overpayments, all deals are with HSBC.

My current mortgage is:
£97,152 Outstanding @ 4.39%
£512 + £123 overpayment = £635pm
5 year fix finishes June 2019
27 years left

First option:
2 year fix @ 1.69% (£374 + £261 over payment = £635pm)
£1920 early repayment charge to be added to mortgage

Second Option:
5 year fix 2.19% (£397 + £238 over payment = £635pm)
£1920 early repayment charge to be added to mortgage

I would like to stick to around £635 per month, any ideas on the savings that could be made?

Any advice appreciated :j

dimbo61

First of all HSBC may not offer you a new mortgage and the extra to pay off the ERC !
Can't see the point of the 2 year deal as you will be looking at remortgaging before June 2019.
What is the fee for the 5 year deal ?
Have you added the ERC onto the existing mortgage debt to work out the repayment ?

clairebeth

I believe these are both 'no fee' products, am I right?

Try using this spreadsheet to compare mortgages:

http://locostfireblade.co.uk/spreadsheet/Index.html

We are in a similar situation to you, we just have a larger mortgage. If you click on my user name, you'll be able to see two of my other threads which discuss the options.

The 2 year fix will probably put you in a better position in two years time, so it's better than just sitting on your higher rate for two years. We had considered the five year option, but we actually end up worse off over the two years and then only have three years left on the fixed rate, so it's not a great option for ditching a fix with high erc.

Use the spreadsheet and compare the options. Good luck!

kingstreet

A short message from your friends at the campaign for the misuse of the word 'remortgage.'

If you plan to remain with your existing lender, you are looking (or should be!) at your lender's products for 'existing borrowers not moving home', or 'customer retention deals' or 'product transfers'.

Where a lender advertises 'remortgage' products it is trying to attract new borrowers who have a mortgage with a different lender who are not moving home. The process involves the repayment of the current mortgage and a change of mortgage deed, hence a remortgage.

This is because a mortgage is not a loan but is a legal document which ties the security property to the loan.

This pedantic looking message is posted only to ensure those who are truly remortgaging look at the correct products for them and those who aren't do the same.

clairebeth

I also noticed that the rates mentioned were for new borrowers (because they are rates that we have looked at ourselves, being with YBS at present), however, when I searched 'HSBC product transfer,' these rates did actually come up, just with this sentence above it:

'Existing HSBC mortgage customers occasionally have additional exclusive offers available to them. These offers are in addition to those shown below so please ask for details.'

getmore4less

option 2 add the fees and you will be over £3100 better off in 2years.