Is it worth the hassle of switching mortgage providers for the sake 0.09% difference?

getmore4less

Need to know your full term/planned payment to do the full number crunch Whats wrong with a 1.44% 2 year fix if you can overpay by loads? You get to do the £25k in 7 weeks then would you have more than 10% available over the next year or so? that's assuming you can't make better sue of the money in savings or pension.

penners324

What are the other costs of remortgaging to a different lender? Valuation, conveyancing, Land Registry.... 
It'll be cheaper to stay where you are and product switch.

penners324

If you're on their SVR already, pay the £25k to them, then fix the balance at the lowest possible rate, probably their 2 year fix....

ericlered7

Unless you have an eye wateringly large mortgage balance owing, then no.

AdventureRocks

getmore4less said:

Need to know your full term/planned payment to do the full number crunch Whats wrong with a 1.44% 2 year fix if you can overpay by loads? You get to do the £25k in 7 weeks then would you have more than 10% available over the next year or so? that's assuming you can't make better sue of the money in savings or pension.

Never thought about the two year fix.
I was thinking it would be best to lock in the interest rates while they are really low?
Ideally i want to be mortgage free in the next 5-8 years. My idea was keep my payments low and save up every year and then pay the max 10% balance if i have it available rinse and repeat.

getmore4less

people think longer fix is less risky when it can actually be more risky because they don't understand what risks have changed.
The big risk of the longer fix is you will pay more.
Crunch some numbers
If you run the 2 year fix then see what rate you can go to after 2 years to be no worse off than the 5 year you may be surprised.
The 2 years rate gives you one rate 0.25% rise for free the overpayment will give you more on some calculations I have done the rates had to rise 3 times in the first 2 years to be worse of on 2 years fixes over a 5y fix
You have to make your own mind up where rates are going, even those long on "rates can only go up" were only right 2 times for a few month in over a decade and even then the base rates only went up to 0.75% and that took 8 months from the low.
Nationwide is a decent lender on retention deals on a 5-8 year plan lowest rate max out the payments, maybe consider their 1.54% 2y tracker if you can go over the 10% annually by enough to make it worth while.

Sistergold

AdventureRocks said:

If anyone can help me please these are the full facts 



£47k left on mortgage to pay once i make an over payment of 25k.

TSB will not let me move to another provider of make an over payment of more than 10% until 1st August. 

If i stay with TSB they will let me move from 3.14% i am on now down to the 1.79% 5 year fix from 1st July (but can not make the over payment more than 10%.)

Am i best waiting until August to see if the TSB drops a bit? I have a mortgage in principal for Nationwide with advisor for 1.69% (got the rate wrong in original post) with advisor.

With such a low mortgage and your ability to overpay why choose a fix at all if you insist on fixing why for such a long time? I am 🤷‍♀️ 

AdventureRocks

Sistergold said:

AdventureRocks said:

If anyone can help me please these are the full facts 



£47k left on mortgage to pay once i make an over payment of 25k.

TSB will not let me move to another provider of make an over payment of more than 10% until 1st August. 

If i stay with TSB they will let me move from 3.14% i am on now down to the 1.79% 5 year fix from 1st July (but can not make the over payment more than 10%.)

Am i best waiting until August to see if the TSB drops a bit? I have a mortgage in principal for Nationwide with advisor for 1.69% (got the rate wrong in original post) with advisor.

With such a low mortgage and your ability to overpay why choose a fix at all if you insist on fixing why for such a long time? I am 🤷‍♀️ 

What would your suggestion be?

Appreciate the help

Reason for fix was to keep the rate low for a long period and have stable amount going out each month. But as things stand i think the interest is going to be very very low for a long time to encourage spending. 

AdventureRocks

If anyone is still about to help my renewal is coming up in August and these are my options on 60%LV 

TSB 2 year fixed @ 1.59% no fee
TSB 5 year fix and flex @1.99% 3 years limited 10% overpayment then last two years I can exit early or overpay a big chunk.

By the looks of things is it best to not lock into anything longer than 2 years with the economic situation? And is there anything a lot better than 1.59% for 2 years? 

I want this debt cleared 5 years max , aim is 3.5 years

BabyStepper

As others have said, the difference in cost between these mortgages is minimal so in those terms, it doesn't really matter. You're fiddling with pennies. Don't get me wrong, I love doing that too. It's deeply satisfying spending a few hours in order to save myself a fiver.

However, if you want help figuring out a plan, we need to know what you're trying to achieve. Mortgage free in 5-8 years? 3.5 years? Which is it? At 60% LtV, is your home worth £90k-ish? Do you want to actually stay in it for 5 years or do you have others plans? What's your income? Is your main aim keeping things stable through the coming recession/depression/whatever it turns out to be? How secure is your job? 

Let us know a bit more and we can try and help. Otherwise, all mortgage rates are tiny at the moment compared to what happened in the 80s, so if mine was up for renewal I'd be grabbing any of them and glad for it.