Remortgage before Brexit

dutchcloggie

Hello,

I'm in a bit of a pickle and need some advice, please.
I am Dutch, married to a British citizen. We have decided that since the Brexit vote, this country is no longer feeling welcoming and the future here is too bleak and uncertain (please, no political discussion, it is just to give context to our decisions). So we have decided to move to The Netherlands. Problem is, our 2-year fixed mortgage ends in April next year and by that time, we do not yet anticipate to have left the country as we need to save up extra money to pay for the move.

So what to do next? Re-mortgage with another fix (that we may not be able to complete if we leave before it ends) or remortgage with a 'normal' tracker?

Further more, what if we want to rent our house here out for, say, a year, whilst settling in the Netherlands, before selling it. We would need a change in the mortgage but how likely are we to get that?

Any tips gratefully received.

Thanks

Dutchcloggie

Thrugelmir

There are many factors which could influence the direction of interest rates. Brexit is not the sole defining issue on which interest rates rest. Given your intention to leave the UK at some point in the future. Do what is right for you at the time when you need to find a new product. Don't try and forecast the future.

If you wish to avoid ERC's. Take the lowest variable rate available to you and overpay by whatever you can afford. If you believe it will take another 2 years to build enough equity, then opt for a fix. Also making over payments.

Letting is all very well. How would you manage the property from abroad though? No guarantees that it will be profitable. As you could find yourselves with the tenant from hell. Or even suffer a fall in property prices.

dutchcloggie

Thanks for the reply. I am not too fussed about what the interst rates are going to do pre or post Brexit. My query is mainly about the fact that I am due to remortgage in the middle of a period where I am preparing to leave the country. We will be leaving before Brexit (March 2019) but not sure when.

So I guess the lowest variable rate will be the option that will be most suitable as we can overpay and also get out of it whenever we want. Are there no ERC with variable rates??

SouthLondonUser

Also, do not underestimate the potential tax implications. I suspect the Dutch fiscal year is different from the British one, which runs from April to April. Could you be considered tax residents in both countries for a period of time? Would you be liable to pay any capital gains tax to the Netherlands when you sell your British property? Etc...

dutchcloggie

Ugh, jesus...I had not even considered that issue. Bloody Brexit!

Thrugelmir

dutchcloggie wrote: »

So I guess the lowest variable rate will be the option that will be most suitable as we can overpay and also get out of it whenever we want. Are there no ERC with variable rates??

Not there's not. Depending upon the amount you owe. May not be worth remortgaging to new lender either for a short period of time. The product options that your existing lender has will therefore be very important when deciding which route to take.

TrickyDicky101

You do realise that at the end of your fix you don't have to remortgage onto another deal? You can simply go onto the lender's SVR for however long you need.

dutchcloggie

Yeah but the SVR is about £300 per month more than we are paying now.

Thrugelmir

Who is your current lender?

dutchcloggie

Accord mortgages. We are on a 2 year fix at 2.24%. After February 2018, this will revert to SVR, which Currently stands at 5.34%. That means our payments would go from £595 to around £825 per month. So we clearly have to remortgage because that is a massive increase.

Thrugelmir

dutchcloggie wrote: »

Accord mortgages. We are on a 2 year fix at 2.24%. After February 2018, this will revert to SVR, which Currently stands at 5.34%. That means our payments would go from £595 to around £825 per month. So we clearly have to remortgage because that is a massive increase.

You can check what options are available to you online. Though it's too early to choose a product and effect a switch yet.

Is your mortgage interest only or repayment?