Worth the Hassle of changing from First Direct?

charlie71

Hi all. I hope someone can give some useful advice.
We are just coming to the end of a 5 year fixed rate. (2.79%)

They have written to us laying out the options -
a) SVR...about 4.2.
b) any of their current deals.
c) leaving ...

I'd like another 5 years fixed - and the best rate they have for this is 2.05% with a £490 charge.

Anyone think it is worth shopping about/changing mortgages (along with the hassle that entails?) I've had a look about (mortgage comparison sites) and can't see anything 'significantly'better that seems worth the hassle.

Presume a new mortgage provider will need proof of income and survey on the house.


Any thoughts please?

The property is worth about £550k and the mortgage outstanding is about £145k.

Thanks -
C71.

Thrugelmir

Speak to a broker. Let them do the leg work and see if they can suggest a better option. Allowing for all the costs involved in remortgaging.

DontBringBertie

2.05% seems like a good rate, mine is 2.19% for 5 years (started in May 2017).

But I agree with the above, speak to a broker. And also allow for their fees which will probably be £250-£500.

dimbo61

Remortgaging to a new lender may well cost a lot more than £500.
Exit fee from leaving your current lender, survey, mortgage fee and legals etc.

demontfort

My 5 year fix ended recently with FD. Mortgage is now only 10% LTV, I was offered a similar deal. Looking around there were slighly better deals elsewhere but I thought it was easier just to stick with FD as there were no fees to pay.





Crazily my FD remortgage is a 3 year fix on £30k, 10% LTV at I think just over 2% but Natwest are offering me a better rate on a £200k 70% LTV for a 5 year fix......ludicrous

Lotak

charlie71 wrote: »

Hi all. I hope someone can give some useful advice.
We are just coming to the end of a 5 year fixed rate. (2.79%)

They have written to us laying out the options -
a) SVR...about 4.2.
b) any of their current deals.
c) leaving ...

I'd like another 5 years fixed - and the best rate they have for this is 2.05% with a £490 charge.

Anyone think it is worth shopping about/changing mortgages (along with the hassle that entails?) I've had a look about (mortgage comparison sites) and can't see anything 'significantly'better that seems worth the hassle.

Presume a new mortgage provider will need proof of income and survey on the house.


Any thoughts please?

The property is worth about £550k and the mortgage outstanding is about £145k.

Thanks -
C71.

The best rate at the moment (that I've seen) is 1.83% from Skipton with a £1995 fee, followed by 1.89% from Santander with a £999 fee.

All things being equal and assuming no other fees (both Skipton and Santander offer free legals / val), anda 25 year mortgage:

Skipton will offer the lowest monthly payment, followed by Santander than First Direct.
However, after 5 years, your mortgage balance is actually lowest with FD, followed by Santander then Skipton as the monthly savings and greater capital repayment (from Skipton / Santander) doesn't fully offset the mortgage fees.

With Skipton, its £611 / m and £122.7k balance after 60 months
Santander, £618 and £122.3k
FD, £620 and £122k

Given this, I actually think it is better for you to stick with FD. If you had a bigger mortgage, it would be worth considering the switch, as the monthly savings scale linearly with mortgage balance and the mortgage fee is much smaller as a % of the mortgage amount.

So ... stick with FD. Saves you the hassle and it actually turns out better for you.

charlie71

Thanks all for the input. Much appreciated.

Lotak - We have 20 years left so payments will be around £735 ish - Currently making overpayments though with a view to paying this off in 11ish years.

We saw the Skipton one, but after adding in the £2k fee, we couldn't see too much difference.

C71.

dimbo61

You would need to go through a full application with another lender.
If you stay with FD you maybe able to arrange the new deal online in a matter of minutes provided your not borrowing any more or changing the term.

zagubov

dimbo61 wrote: »

You would need to go through a full application with another lender.
If you stay with FD you maybe able to arrange the new deal online in a matter of minutes provided your not borrowing any more or changing the term.

No, it's a telephone bank, and not primarily an online one.

They'll interview you on the phone, therefore, before that, you should research better deals using this main forum's mortgage search tools and start scanning/photoing your recent bank statements, payslips etc. just as if you're applying elsewhere. Do make sure you have some good calculated deals from rival banks to quote at them.

You will have to discuss your financial affairs with FD very thoroughly, but it's very likely that, if you're patient enough to sit through that, they'll have a retention product thats better value than the ones other banks can offer.

They made us jump through loads of hoops to re-mortgage but it was worth it in the end.