Mortgage deal expiring

Jonnyanderson28

Hi all

Me and my wife bought our first home in July 2017. We arranged our mortgage through an advisor, and settled on a 2-year fix from Nationwide, meaning that it's due to expire this summer. In the last week we got a letter from Nationwide, asking us if we'd like to sign up for a new deal with them.

This is our first time being in this situation, so just wondered if anyone had any advice. The letter we received indicated that we could potentially get the same offer again on another 2-year fix – or a slightly better rate, if we paid an upfront fee. (Obviously we'll have to do some sums to see which works out cheaper.)

I called Nationwide today to ask what the process was be, and they advised that it should be very straightforward. The guy on the phone suggested that they wouldn't require any further documentation, and – perhaps crucially – that they wouldn't carry out a valuation. We bought our flat at what seems to have been the top of the market, for now at least, and the Zoopla estimate (for what it's worth) values it slightly below what we paid... going on the price we paid, our LTV is down from 90% to just about 85%, but whether a lender's valuation would agree with that, I'm not sure!

I guess my main question is, are there any drawbacks to looking into and even applying for a mortgage with someone else, to see if we can get a better rate? If it's declined, or if they value the property lower and offer a worse rate, is this likely to have any impact on the re-application process with Nationwide?

Any other more general hints and tips also very gratefully received!!

Thanks in advance

Jonny

Mortgage_Adviser

You need to compare the cost of the best preferred dela type (eg 2 year fixed) with Nationwide with the best deal available to you elsewhere.


You will then have to consider if there is any money saving in moving to other lender taking in to account all the costs such as mortgage arrangement fees, any legal fees, broker fees, valuation fees etc.


If there is no saving the obvious answer is to stay with Nationwide.


If the saving will be very small it is worth considering if that small saving is worth the hassle and time of yours.

Thrugelmir

No harm in comparing what is on offer from your existing lender with that of the wider market. In doing so factor in the costs of remortgaging to a new lender. As they soon add up. Some lenders do offer free valuations or legal fees when touting for new business.

Jonnyanderson28

Thank you for the quick response!

I guess if I look at the best deals on offer with the most optimistic valuation etc, I may find that even the best case scenario is only a fairly small saving... in which case sticking with Nationwide it is.

Jonnyanderson28

(Previous reply to 'Mortgage_Advisor')

And thanks to you too, Thrugelmir! I'm just hoping the quote in your sign-off isn't a portent for the price of my property :rotfl:

kingstreet

Jonnyanderson28 wrote: »

that they wouldn't carry out a valuation

An inspection won't be undertaken, but Nationwide does use its House Price Index to produce an estimated valuation.

Brokers can access this as part of the product transfer system. You may also be able to do this online, to establish your indexed valuation.

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