Mortgage rate or final amount

sammyj84

So If you had to pick one of them for yourself what one would you go for? 

getmore4less

If a switch/remortgage what is your current lender offering as a switch.

Any other costs involved.

I would want to run the numbers for 2y and potential overpayment

Petriix

The no fee option is objectively better if you're planning to overpay. Whether you would be better with a shorter fix is a gamble that you'll only be able to answer with hindsight. I can't see rates getting much lower.

sammyj84

getmore4less said:

If a switch/remortgage what is your current lender offering as a switch.

Any other costs involved.

I would want to run the numbers for 2y and potential overpayment

This is our first mortgage ever.

getmore4less

I realised why the cost calculator is getting it wrong they are spreading the fee out over the full term by adding it and setting the payment where it needs to be done over the fixed term for a proper comparison.

FTB a little unusually being in the 60% and under LTV category but does give you these great rates.
(you said FTB in first post I just forgot)

Looking at the Nationwide using my breakeven calculator it comes up with £53,500 for a 10y term  £47k is under that so no fee is the way to go if choosing them.

Need to check the cashback often it is or free legal.

The natwest is slightly better over the term but the extra £250 nationwide cashback  is what does it. 

Just to throw another option into the mix.

Some look at the tracker and switch options because a few  lenders have no ERC trackers and better rates on their existing customer product switch.

eg Nationwide have a 1.69% no fee 2 year tracker and a 1.49% no fee 5 year rate switch.
That would save around £200 over the 5 years against 1.89% with £500 cashback, if you could track and switch without penalty.

Nationwide has a pretty good history of rate switch products and after the 5 years of regular and overpayments the mortgage will be small and any future savings from slightly lower rates with a different lender will be minimal. 

For  an idea of what overpayments can do,  on the 1.89% starting at £47k  you get to £24.5k after 5 years up the payment to £600pm and you are down to  £14k and save £500 in interest







 

sammyj84

Thank you for all your help.

Think I'm going to ahead with the Nationwide 

getmore4less

sammyj84 said:

Thank you for all your help.

Think I'm going to ahead with the Nationwide 

Don't forget it is the no fee you want it will be cheaper over 5 years and the more you overpay the cheaper it gets.

sammyjammy

When it comes to mortgages with a fee you need to look at how much you are borrowing, the less you are borrowing the more unlikely it is a good option.

sammyj84

getmore4less said:

sammyj84 said:

Thank you for all your help.

Think I'm going to ahead with the Nationwide 

Don't forget it is the no fee you want it will be cheaper over 5 years and the more you overpay the cheaper it gets.

We plan to over pay as an when we can so doubt it will be every month and i believe there is a limit on how much you can over pay also.

I still find it mad how a lower interest rate and monthly amount can be more expensive long term. Lol 

getmore4less

sammyj84 said:

getmore4less said:

sammyj84 said:

Thank you for all your help.

Think I'm going to ahead with the Nationwide 

Don't forget it is the no fee you want it will be cheaper over 5 years and the more you overpay the cheaper it gets.

We plan to over pay as an when we can so doubt it will be every month and i believe there is a limit on how much you can over pay also.

I still find it mad how a lower interest rate and monthly amount can be more expensive long term. Lol 

It's because you have to pay £999 extra for the lower rate.

There is a 0.5% difference in rate

Rough break even when on interest only over 5y.

(999/5)/0.005   ~£40k it goes up for repayments.