Using a Bank Loan instead of mortgage ?

snapyou

I have an endowment mortgage and considering cashing it in ,putting it towards the mortgage and paying off the mortgage in the remaining time I have (4 years)

The outstanding amount would be £12,000 over four years.

I am currently with the Halifax and the best interest rate they offered was 7.49%

However,what is to stop me getting a bank loan (at lower rates than 7.49%),paying the mortgage off immediately and just paying off the loan over 4 years?

bigstevex

Nothing to stop you doing that, but there must easily be better rates out there!

snapyou

bigstevex wrote: »

Nothing to stop you doing that, but there must easily be better rates out there!

Thanks for the reply but according to London County there aren't better rates as I"ve only got 4 years left to go and it' for such a relatively small amount.
Would love to be proved wrong though.
Anyone know?
Thanks in advance

MortgagesInc

At that level there's no real point remortgaging, as it would only save you a few hundred pounds at most. If you look at personal loans just look at the total cost over the four years and compare it to the mortgage, as some lenders work out interest etc in different ways

Dan_Collins_2

Halifax should offer you better than that but they have minimum loan amounts on the range so you get littel choice. However at that loan size i would not worry. Just take the rate with no fees and in 4 years put ya feet up!

bigstevex

Ahh, true the small amount will mean you might not get a good deal!

A low rate loan for the final few years would probably be best, but don't forget if you want to pay the loan off early you get charged

I'm not an advisor though remember!

ic

Also remember that the loan would be unsecured - if something were to happen in the next four years and you couldn't make the repayments, you'd at least be safe in the knowledge that the house is yours and can't be taken off you!