Mortgage deal ending, the house now worth much more - remortgage or not?

xxktlou02xx

Hi there,

My current mortgage deal is due to end at the end of June. Our house was very run down when we bought it and have completed a full refurbishment. I think it's worth around £100,000 more now than when we bought it. We had wanted to have the house revalued and go onto a much lower LTV  so we have access to better rates and pay less overall.

Currently with Yorkshire building society, and if we switched deal we'd end up on a 2.05% fixed for 2 years with 82% LTV as we stand (no product fee, its the same price overall as their cheapest remortgage rate with a £1495 fee and we don't have to pay the remaining £1300 at the end of the 2 years), or I can try and remortgage as a new customer, stay with YBS and get a 5 year fixed deal with a £495 fee and free valuation at 1.61% and a 64% LTV. Price wise I'd be around £38 a month better off as a new customer after the product fee is considered, and I'd be fixed into a good deal for 5 years.

I'm just not sure if its worth doing at the moment. I don't want to go onto the standard variable rate they've got at the moment, I'd be paying an extra 50% each month for my mortgage, and I'd like to fix at a good rate for 5 years while the going is good, it's just the valuation problem and Coronavirus.

JimmyTheWig

Personally I'd go with the 2 year fix without the need for a valuation.
You don't know how long it will take anyone to get around to doing a valuation, so don't know how long you might be on SVR.
You don't know if someone independent will agree that you've added £100,000 worth of value. (I don't know you so have no idea, but please be aware that many people over-value the home improvements they themselves have done.)
You don't know what house prices are going to be like when we come out the other side of the pandemic and so your LTV might not be as good as you are hoping.
With all those unknowns, I'd kick the can down the road for a couple of years and then get a better rate once things are more stable.