Mortgage advice please!

Blades-man

Off to see a mortgage broker this week but wanted to get the thoughts of other MSE's prior to this so here goes:
I've come to the end of my fixed rate so time to strike a new deal. I am currently on an interest only mortgage, £132000 and make regular over payments in order to pay the capital during my mortgage term. My current lender has offered my a 2.39% deal (interest only) (£239 pm) if I put down £11500 (I have savings so could do this) but know that repayment deals at the moment are as low as 1.24%. The dilemma is this: I have a well paid job but only have 2 and a half years left of my contract which is not going to be renewed therefore...do I take the interest only deal, having a small monthly payment should I find myself out of work or do I just go for the repayment option as paying less interest is definitely of benefit during the next couple of years and hope that I don't take too long to find work after this contract.

Many thanks

ACG

See what the broker comes back with.
They may beat what you have been offered, they may not. But other than a bit of time you have nothing to lose.

getmore4less

What would your follow on rate be?
What LTV now and best rates on that?
What LTV do you need for those 1.24% rates?

on £120.5k over 2 years the max it will cost you for the 2.39% against a 1.24% is £2772.

might be worth considering a short spell on the follow on till contract is in place then review the better options with visibility of funding for the repayment

Might be worth considering something like an offset that can help manage cashflow between contract in the future.

.........
Just reviewed and saw that the current contract is 2.5 years I had months in my head writing the above .

I think I would go for the low rates now and build the between contracts buffer either savings(rather than overpaying) or offset.

I would also look at options like lifetime tracker rates to avoid any clash of contract renewal with debt review.