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Re-morgaging and early repayment
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ragdollyana
Posts: 15 Forumite

Hi, Our current mortgage deal is finishing in July 2023. I am thinking about re-morgaging with my current lender. They have offered a lower rate which would save us £150 a month and £9000 over the course of 5 years. There would be a £5000 early repayment charge (5% of current amount borrowed). So this would mea a £4000 saving. Feels like alot of money to pay out upfront, but we can afford to pay out of savings.
The reason we would like re-mortgage is that my partner is self employed and his earnings will be taking a hit in the next year or so due to the current covid pandemic. He has to provide two years of accounts I have a perm job and my earnings will cover my 50% of the 'provable' earnings. We can afford our month payments, but he needs two years of accounts proving earnings at a certain amount and this may prove difficult. lm also conscious that if we did wait to re-mortgage in two years we may not get as good a rate if interest rates go up. Our current lender is offering 1.7% for 5 years on the new deal.
I'd appreciate any advice on this. Thanks in advance.
The reason we would like re-mortgage is that my partner is self employed and his earnings will be taking a hit in the next year or so due to the current covid pandemic. He has to provide two years of accounts I have a perm job and my earnings will cover my 50% of the 'provable' earnings. We can afford our month payments, but he needs two years of accounts proving earnings at a certain amount and this may prove difficult. lm also conscious that if we did wait to re-mortgage in two years we may not get as good a rate if interest rates go up. Our current lender is offering 1.7% for 5 years on the new deal.
I'd appreciate any advice on this. Thanks in advance.
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Comments
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Missing information need
Lender
Amount borrowed
LTV
current rate
full term
payment.
Fees for new deal
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Hi
Thanks, info below
1) Halifax2) 170k
3) 55LTV
4) 3.3
5) 26 yearsThere are no fees for the new deal (1.79) as it is a product transfer with our current lender.0 -
Will crunch the numbers later.
1.7% is quite high for 55% LTV. Halifax charge more under £250k.
Retention deals should be available without checks .
Do they have a fee rate for retention?
Any overpayment plans as that makes a difference.
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Hi, Yes they have said there will be no checks or documentation needed as it's essentially a product transfer. They have said there are no further fees on top on the 5%. No repayments plans either. Thanks for your help.0
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Key date is July 2023 say 30months (might be 29)
£170k 26 years 3.3%
ERC 5% £8,500, Where did £5k come from?
typicaly 3% in Year 3 so maybe £5,100 lets go with that.
£175100 1.79%
where would they both be in 2y6m adding fees make payment same as now.
Save ~£1030amount rate payment owing £170,000.00 3.30% £812.35 £159,231.20 £175,100.00 1.79% £812.35 £158,202.57
if going to pay up front it changes too
save £825amount rate payment owing £164,900.00 3.30% £812.35 £153,693.22 £170,000.00 1.79% £812.35 £152,869.33
if it is only 29 months to end then it looks like
~£826amount rate payment owing £170,000.00 3.30% £812.35 £159,604.62 £175,100.00 1.79% £812.35 £158,778.07 amount rate payment owing£164,900.00 3.30% £812.35 £154,081.84£170,000.00 1.79% £812.35 £153,452.78~£630
The halifax switch should be easy but I would look at what else you can get
with income sources a broker may be needed to weed out the picky lenders.
There are rates for 55% LTV as low as 1.19% with £1500 fee. (TSB intermediaries)
That stacks up against your current option(there are others in between if TSB does not like you.amount rate payment owing £170,000.00 3.30% £812.35 £159,231.19 £175,100.00 1.79% £812.35 £158,202.56 £176,695.00 1.19% £812.35 £157,303.77
even with the massive fee that is covered in he 2.5 years leaving you potentially with the 1.19% for another 2.5
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Thankyou for you advice, that's very comprehensive. I'll have a good look through this today. Thanks again
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Thankyou for you advice, that's very comprehensive. I'll have a good look through this today. Thanks again
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