Mortgage - Stick or Switch?

Cotta

Hi All,

I have around £66k left on my mortgage at a rate of 4.69%. The renewal is not until February of 2019 with an early resettlement charge of 5%. I recently spoke to my mortgage broker in passing when I met him by chance whom I feel gave me poor advice. He suggested I pay the resettlement charge and move mortgages due to the imminent interest rate rise.

Do anyone else think this is good advice from the broker?

getmore4less

Probably not a lot in it with 16month to go.

Switching now could protect against rises if there are any.

What's your full term and LTV?

Cotta

getmore4less wrote: »

Probably not a lot in it with 16month to go.

Switching now could protect against rises if there are any.

What's your full term and LTV?

House valued around £90k.

Cotta

Any further information on this?

YHM

Hi Cotta

If your ERC is 5% of original balance and that is fixed throughout your term, it is highly unlikely you will recover that if you were to break out of it. However, interest rates are a lot lower than they were formerly, and for a new 5 year rate, you would be looking around the 2% mark for a new rate at that LTV.

Depends what is important to you? Paying the ERC and having long term stability or not paying the ERC and just riding it out until it falls off its fixed in 2019.