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Split mortgage or take out new total one?
DaveS88
Posts: 3 Newbie
We have a £160k mortgage split into two parts, both with the same company (it got a bit complicated when we moved last year).
1. £138k - expires 1 July 2021
2. £22k - expires May 2022
I've been looking around for the best rates and was going down the route of paying an ERC (approx £600) on the smaller part in order to tie everything into one provider.
I have a mortgage appointment with our current adviser next weekend but don't think they're going to be competitive overall. I've already had an agreement in principal plus a mortgage appointment with another adviser who can offer a more competitive rate on the £160k balance overall, but this has a £1k fee.
We also want to take a few years off of the existing 16 year mortgage and take it down to 14.
However, it occurred to me today that I could also keep the £22k mortgage with the existing company and renew it next year, but switch to another for the £138k. Looking at rates on this (and we'd probably prefer to not pay a fee on a new product if taking out less mortgage) we'd be paying about £50 more per month than if we grouped it all into one and forked out fees and ERC.
Getting into a rabbit hole over it really - would appreciate any sensible feedback (from someone better at maths than me
).
1. £138k - expires 1 July 2021
2. £22k - expires May 2022
I've been looking around for the best rates and was going down the route of paying an ERC (approx £600) on the smaller part in order to tie everything into one provider.
I have a mortgage appointment with our current adviser next weekend but don't think they're going to be competitive overall. I've already had an agreement in principal plus a mortgage appointment with another adviser who can offer a more competitive rate on the £160k balance overall, but this has a £1k fee.
We also want to take a few years off of the existing 16 year mortgage and take it down to 14.
However, it occurred to me today that I could also keep the £22k mortgage with the existing company and renew it next year, but switch to another for the £138k. Looking at rates on this (and we'd probably prefer to not pay a fee on a new product if taking out less mortgage) we'd be paying about £50 more per month than if we grouped it all into one and forked out fees and ERC.
Getting into a rabbit hole over it really - would appreciate any sensible feedback (from someone better at maths than me
). 0
Comments
-
You won't be able to have 2 lenders.
Which lender are you with.
At £160k fee deals are probably going to be the best options.
Put up what you have now and what is being offered name lenders if you want help.
0 -
Why reduce term when you can just overpay?0
-
Oh right, was wondering if it was possible to have two providers - guess that’s that option out of the window then!
Wouldn’t the interest be higher on a longer term mortgage? What is the advantage of taking a longer term and overpaying (we can certainly afford to do that)?
Cheers0 -
Interest is based on what you pay.DaveS88 said:Oh right, was wondering if it was possible to have two providers - guess that’s that option out of the window then!
Wouldn’t the interest be higher on a longer term mortgage? What is the advantage of taking a longer term and overpaying (we can certainly afford to do that)?
Cheers
Overpaying is the same as paying high.
The advantage of overpayments is you can stop them.
Once on the shorter term higher payment you have to pay it.0
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