Abbey present standard variable

jonnyb1978

My fixed rate mortgage is coming to an end in January and im trying to find abetter deal.
When i took out the deal the rate was 4.5% for 2 years then will increase to the standard variable rate. At the time was 6.5%.

Obviously interest rates have gone up so how do i find what i will be paying come January??

MortgageMamma

Hi Jonny

Well, you could call your current lender approx 6-8 weeks before the deal ends and see what the best is they can offer you

Then speak to a whole of market mortgage broker and see if they can better it.

If yuo call your lender now then they probably wont be able to give you the new deal because its too early, if you let me know who your current lender is I might be able to check for you...

herbiesjp

Could it be Abbey MM? lol

Abbey SVR is 7.84%

MarkyMarkD

Jonnyb

Perhaps checking your lender's website would be quicker than posting a question on here?

Or indeed, putting "abbey svr" into google gets you the answer on the first hit.

MortgageMamma

LO herbies, didnt read title of thread, but it was their retention products i was after not the svr rate!

MM

jonnyb1978

Couldnt find it at first. So am i right in saying that the variable rate follows 2.09 points above the Bank of England base rate as that is now 5.75.
If the bank increases rates by 0.25% then the variable rate should increase to 8.09??

MortgageMamma

the variable rate does not exactly track the bank of england base rate, although it is influenced by it. A lender will normally increase their SVR if the BOE rate increases but they are a bit slower at reducing their SVR when it decreases. The SVR rate is basically set by the lender at whatever rate they choose.

jonnyb1978

Ok thanks i just shopping around and trying to compare and save.

So if the figures stay the same come January i will be paying 7.84% with respect to my 4.39% im paying now on a £40000 mortgage. Im guessing payments will increase by around £60 a month. Im drawn to Nationwide who are offering 5.63% for 5 years then 7.24%.

Seems ok to me.....i think but still looking around

MortgageMamma

are you looking to fix your mortgage? Nationwide are indeed v competitive at the moment, but remember to watch the fee's. for a mortgage your size you would be better to take a higher pay rate and no fee's.

MM

jonnyb1978

Yes im hoping for a 5 year fixed with an extra £20000 so looking for a total of £60000. Ive looked at most fee free and they seem that i will be paying £30/£40 a month more. That nearly £2000 extra for the five years. So surely its better to have have £500/1000 fee as this is lower than the £2000.

Anyways i have found the Nationwide 5year fixed @ 5.63% reverting to 7.24% after 5 years. For a £60499 (499 being arrangement fee) payments will be £420.62 then £465.37

Also Brittannia have a better but with more charges option @ 5.39 reverting to 7.45%.
A £59500 with (£185 valuation fee, £999 arrangement fee and £285 legal)
Total £60919 payments are £405.61 reverting to £458.93.

I should of put £60000 in for the Britannia mortgage but with recieving £500 less i will be saving £15.01 each month comparing the two which over the 5 years come to just over £900.

So im inclined to look further into the Britannia one at the moment.

I should add they both are over a 20 year term.

MarkyMarkD

MortgageMamma wrote: »

the variable rate does not exactly track the bank of england base rate, although it is influenced by it. A lender will normally increase their SVR if the BOE rate increases but they are a bit slower at reducing their SVR when it decreases. The SVR rate is basically set by the lender at whatever rate they choose.

That's a bit of a cynical view, MM, and not generally true.

Most lenders (now) increase and decrease their rates at the start of the month following a BoE announcement. They don't take advantage in the way that MM suggests.

What they may do, though, is not pass on the whole of the BoE rate change - so if the BoE rate falls 0.25%, they may reduce their rate by 0.20% (say). Or the opposite way round when rates rise.