Remortgage...which way shall I go?

sam1970

My current 2 years deal will end in 6 weeks (0.5% above BOE)and my broker suggested that time is not enough to move to another lender before end of deal. I am looking to fix for 5 years considering all uncertainties about interest rates.

My broker suggested two options:

1- Stay on a retention deal with my current lender (similar to my current rate) to buy time until we find a good 5 years fix later on. It sounds like a good idea but the problem is I am worried that the delay will reduce the chance of getting a good deal.

2- Moving to a 5 years fixed deal with my current lender at 1.99%. The attraction is that it should be quick and less messy process. No valuation or legal work and no requirement to submit loads of documents. The problem is that I can get better 5 years rates (1.75%) from other lenders, and I counted the saving to be around £4000 over the 5 years.

I do have a big mortgage but my LTV is about 50%. Grateful for all advice.

getmore4less

if your current lender has retention deals at similar rates to base + 0.5 how similar are they?

ACG

6 weeks is enough time, it is cutting it tight but doable. Even if it can not be done, you would only end up on the lenders SVR for a week or 2 max assuming no major problems.

I can not see any benefit in option 1 if you are planning on leaving anyway. Rates have already starting going up and that will happen more and more over the next few weeks I think.

It sounds like your broker is either busy or lazy and wants the easiest route to get you off his desk for the time being. I could be wrong but if you want to fix for 5 years, I think now is the time to get your application in.

Thrugelmir

sam1970 wrote: »

The problem is that I can get better 5 years rates (1.75%) from other lenders, and I counted the saving to be around £4000 over the 5 years.

On what grounds has your broker dismissed this option?

sam1970

He didn't discount it but he suggested the time scale is not enough to move to another lender before end of current deal

Libber

As ACG said, your best bet will probably be to start the process of securing the 1.75% five year fix with the new lender and accept that you may spend a few weeks on your current lender's SVR when your current two year term ends.

Glover1862

Are you 100% sure you are eligible for the better 5 year fix and are you comparing the product fees correctly. If all good then nothing to wait for.

sam1970

Thank you guys. Yes I am eligible for the better deal and it has the same fee (£995)

Thrugelmir

Then taking up the 1.75% product while it's still available. Seems the option to take.