help to buy and the path to being mortgage free!

daveyb16

Hi guys,

Really hoping the financially savvy people of the MSE world can solve a conundrum for me.

I have three months left of a 2year fixed and I am starting to look around for my next mortgage product. I currently owe £160000 on a property worth approximately £280000.

Unfortunately I also owe separately 20% of my homes property value to the government as I originally partook in the H2B scheme in December 2014. I have approximately 40000 in savings and before I choose my next product I honestly have no clue which path to go down with all of this.

1. Do I gather some more funds (Which is possible. Kind of) and clear the help to buy ultimately meaning although I have no savings, I will have £120000 in equity. I can then qualify for the best 60% LTVs out there.

2. Do I risk leaving the help to buy in place as the H2B does not kick in and ask for interest only repayments until Jan 2020 (£74 per month at a rate of 1.74%). The problem with this option is I have to pay back 20% of the value at the time of redemption. Therefore if prices go up my required repayment goes up. I also have the issue with this one of not having access to the best mortgage products as H2B customers do not get access to the same products on LTVs as standard mortgage owners do.

3. When I can do so without any penalties do I clear the 40K off my mortgage leaving me with approximately 120000 left on it, and then remortgage and borrow the H2B part on top of my current debt

4. Anything else you guys can think of!

I have been overpaying on my current mortgage a £1000 a month for 15months now, and for the foreseeable future I aim to continue to do this within the bounds of any overpayment allowance. I also have a preference to fix in long term for five years with a competitive rate. E.G lloyds 1.89% but again Im open to any suggestions!

Thanks for taking the time to read this guys!