Mortgage Review - What to do!!

CactusCymru

Hi people! First post so be kind!:)

We're planning on getting professional advice but just thought I'd post to see if anyone has any thoughts or advice they could offer.

We currently have £142k left to pay on our mortgage for our house. We have 9 years 3 months remaining. This is comprised of

£56k - 3.24% Lifetime Tracker
£73k - 1.23% Lifetime Tracker
£13k - 3.94% SVR

Fortunately the largest figure (£73k) is on the favourable 1.23% rate.

Our house is valued at approx £400-£450k and we both hold down full time work. We are mortgaged up to the hilt and could do with releasing some money to replace our car and do some home improvements. For information I'm 45 and my wife is 40.

It would be helpful to know whether we would be better to consolidate the 3 mortgages into 1 and what options do we have to release some funds for other areas of our life!!

Many thanks for any advice and guidance you may be able to offer:)

bigstevex

"Mortgaged up to the hilt" £142k on a house worth 400-450K is definately not mortgaged up to the hilt.

3.24 lifetime tracker and 3.94 svr are what you want rid of with that kind of LTV and current rate climate. 1.23 is good, is that including the recent .25 hike?

Releasing money to buy a car, that's bad financial sense to me. Home improvements are fine.

Thrugelmir

bigstevex wrote: »

Home improvements are fine.

Depends what they are. Not all "improvements" add value.

Frogstar

Your LTV is only something like 36%, with you both being in fulltime work, presuming you don't have a poor credit history, you should be able to have your pick of mortgages on the market.

I'd like to consolidate because it's simpler. But you could also consider just consolidating the two parts with the 3% rates, as I would consider those to be high. Even 5 year fixed rates would be closer to 2%.

Generally in the current climate people will advise fixed rates, and if you are considering home improvements presumably you are ok being in the same property for a few more years.

142k isn't much really, but if you are planning to pay it all off over the 9 years remaining, that implies very high monthly payments? Depending on your priorities for when you want to retire and so in, you could extend the mortgage term to free up more monthly income.

Obviously long term that means more interest, but say putting the spare money into pensions would give a better rate of return than the mortgage payments would. ....or might let you buy the car! (thus causing the MSE forum to face palm! Haha)

CactusCymru

bigstevex wrote: »

"Mortgaged up to the hilt" £142k on a house worth 400-450K is definately not mortgaged up to the hilt.

3.24 lifetime tracker and 3.94 svr are what you want rid of with that kind of LTV and current rate climate. 1.23 is good, is that including the recent .25 hike?

Releasing money to buy a car, that's bad financial sense to me. Home improvements are fine.

Thanks bigstevex. We have worked hard to date to reduce our mortgage and our payments remain very high out of choice which is why I stated mortgaged up to the hilt.

Yes the 1.23% rate is after the recent .25% hike. The product is a HSBC LifetimeTracker which we took out around 2010/11.

Finding it difficult to identify finance to support replacing our current car which has nearly 100k on clock and now frequently costing more to fix.. Our mileage annually is high supporting our teenager train and compete as an GB athlete around the UK....we need a reliable vehicle.

Frogstar wrote: »

Your LTV is only something like 36%, with you both being in fulltime work, presuming you don't have a poor credit history, you should be able to have your pick of mortgages on the market.

I'd like to consolidate because it's simpler. But you could also consider just consolidating the two parts with the 3% rates, as I would consider those to be high. Even 5 year fixed rates would be closer to 2%.

Generally in the current climate people will advise fixed rates, and if you are considering home improvements presumably you are ok being in the same property for a few more years.

142k isn't much really, but if you are planning to pay it all off over the 9 years remaining, that implies very high monthly payments? Depending on your priorities for when you want to retire and so in, you could extend the mortgage term to free up more monthly income.

Obviously long term that means more interest, but say putting the spare money into pensions would give a better rate of return than the mortgage payments would. ....or might let you buy the car! (thus causing the MSE forum to face palm! Haha)

Thanks Frogstar for your advice. Yes I think we would have the pick of the mortages on the market. The issue that I need to explore is whether we can consildate 2 of the 3 mortgages retaining the best one (1.23%). We're actually considering if this was possible consolidating the 2 into a 5 years fixed for security with the uncertainty over brexit impact and BoE rates creeping up.

Yes our payments have always been high and we've never extended the term of our mortage each time we've moved. It's currently proving a bit more of a challenge with children going through high school and one being a GB athlete in a sport that attracts little funding!

Yes MSE Forum facepalm may happen if we extended term to release some money as I guess it would go to replacing car . We're struggling to identify alternative finance which is why we're exploring this option via tweaking our mortgage but understand this isn't good financial practice..

Frogstar

I have to admit that I'm not sure if it is possible to consolidate 2 of the 3. You would expect so, but things aren't always as practical and straightforward as you'd hope them to be! It shouldn't be too tricky to find out from e.g. London and country or equivalent.

I wouldn't even say it's bad financial practice as you know what you are doing, have considered the options and are using your finances to achieve what you want - supporting gb career/schooling

getmore4less

Ask HSBC what they have to offer for the 2 bits on the high rate and if they can offer more borrowing.

if you want to free up money look at longer term as rate reductions don't reduce the payments that much

getting the rate down to 2% will save about £50pm going out to 15 years another £500pm