Remortgage Advice

scoey8

Hi all, 

Looking to remortgage to halifax, my broker has agreed to do it for free however i have just seen Halifax are offering £750 cashback which is not payable if you use a broker. 

It says the cashback will be paid to your conveyancer, sorry if this is a stupid question but i didn't know i needed to employ one? I just thought you applied on the website and they sorted out moving the mortgage etc. a bit like when you switch bank accounts. Can anyone confirm?

Also the property is right to buy and still in the pre emption period so will need a deed of postponement. My broker says there will be a fee approx £200-300 plus vat. Does this sound about right? 

Thanks

K_S

@scoey8

- If you are remortgaging to a new lender (Halifax), you will indeed require a solicitor. Halifax remo products usually offer free legals if you are happy to use their solicitor.

- Out of interest, would you mind pointing me towards this £750 cashback product? If you will indeed get £750 cashback by going direct then that would make sense to do.

- The conveyancer will give the exact cost involved in the deed of postponement, but £200-300 sounds about right.

scoey8

K_S said:

@scoey8

- If you are remortgaging to a new lender (Halifax), you will indeed require a solicitor. Halifax remo products usually offer free legals if you are happy to use their solicitor.

- Out of interest, would you mind pointing me towards this £750 cashback product? If you will indeed get £750 cashback by going direct then that would make sense to do.

- The conveyancer will give the exact cost involved in the deed of postponement, but £200-300 sounds about right.

Hi Thanks for your reply. 

So it's as simple as just asking Halifax to use their solicitor, sounds good. 

Here is a link although i am having trouble finding out exactly which products it applies to;

https://www.halifax.co.uk/mortgages/remortgaging.html

I have done an AIP which we have been accepted for, just wondering what advantage there is in using the broker, suppose they might have a better chance of appealing if something goes wrong etc.

K_S

scoey8 said:

K_S said:

@scoey8

- If you are remortgaging to a new lender (Halifax), you will indeed require a solicitor. Halifax remo products usually offer free legals if you are happy to use their solicitor.

- Out of interest, would you mind pointing me towards this £750 cashback product? If you will indeed get £750 cashback by going direct then that would make sense to do.

- The conveyancer will give the exact cost involved in the deed of postponement, but £200-300 sounds about right.

Hi Thanks for your reply. 

So it's as simple as just asking Halifax to use their solicitor, sounds good. 

Here is a link although i am having trouble finding out exactly which products it applies to;

https://www.halifax.co.uk/mortgages/remortgaging.html

I have done an AIP which we have been accepted for, just wondering what advantage there is in using the broker, suppose they might have a better chance of appealing if something goes wrong etc.

@scoey8 As far as I can tell it looks like the £750 cashback applies if you do the remortgage direct using a non-advised route (I might be wrong about the non-advised part). From what I can see it applies to any product that shows up when you put in your requirements.

Do keep in mind that you can potentially access better rates (Halifax broker exclusives) through some brokers which may or may not outweigh the cashback depending on the numbers involved.

getmore4less

How big is your mortgage
full term.
fix term
LTV
any planned overpayments 
Deal on offer direct


£750 is in effect just a different net fee for doing any comparison calculations.

Can then work out what rate the broker need to have to be cheaper over the fixed term.

scoey8

getmore4less said:

How big is your mortgage
full term.
fix term
LTV
any planned overpayments 
Deal on offer direct


£750 is in effect just a different net fee for doing any comparison calculations.

Can then work out what rate the broker need to have to be cheaper over the fixed term.

Hi thanks for the reply. 

Current Mortgage is for £129000 and LTV is about 59%. There is 25 years left to run and my fixed term with Vida homeloans @ 3.69% interest is about to run out. 

I am applying with Halifax as my partner still has a default on her account and they seem quite lenient for a high street lender. 

Broker has suggested the following with Halifax 'There is currently a 1.57% fixed rate until 30/09/2024 available which is totally fee free the repayments over 25 years on a capital repayment basis will be £518 per month'.

So a 3 year term which would be my ideal term length. However would not recieve the £750 cashback. 

Other option is to go solo but i cannot see that Halifax offer a 3 year term with the cashback, looks to be 2 or 5. Maybe comes down to whether to Broker can use his contacts with Halifax if approval is touch and go? and if the risk of going alone is worth the £750 cashback. 

edit: Putting my figures in the link i posted above (for the cashback products) it comes up with the following for a 5 year fix;

5 year fixed rate

Fixed rates from

1.49% to 1.61%

Monthly payments from

£513 to £521

Product fee from

No fee to £995

So if i take it that the no product fee is the highest rate of 1.61% this is only 0.3% more than what the broker is suggesting for a 3 year fix? 

K_S

@scoey8 Doesn't look like Halifax offer the 3 year term direct product with cashback.

From a quick look (I might be wrong on the direct part as I only have the link you shared to go by) - at 5 years you could fix for 1.22% no-fee with a broker or 1.61% no-fee direct with £750 cashback. Over the fix period, the savings from the lower interest rate easily exceed the cashback.

scoey8

K_S said:

@scoey8 Doesn't look like Halifax offer the 3 year term direct product with cashback.

From a quick look (I might be wrong on the direct part as I only have the link you shared to go by) - at 5 years you could fix for 1.22% no-fee with a broker or 1.61% no-fee direct with £750 cashback. Over the fix period, the savings from the lower interest rate easily exceed the cashback.

Hi, 

As above when i put my figures in (£215k value, £129k mortgage remaning over 25 years) i get the rates i listed above for 5 years. 

Where do i find the 1.22%? and why is my broker quoting 1.57% over 3 years?!

Thanks

Edit: Just put the figures in again and rates have gone up from earlier!

Value - 215k

Amount owing - 129k

Years left - 25

• 2 year fixed rate

  Fixed rates from

  1.27% to 1.82%

  Monthly payments from

  £502 to £536

  Product fee from

  No fee to £995

  Is this deal right for me?

• 5 year fixed rate

  Fixed rates from

  1.49% to 1.93%

  Monthly payments from

  £515 to £542

  Product fee from

  No fee to £995

  Is this deal right for me?

• 10 year fixed rate

  Fixed rates from

  2.13% to 3.1%

  Monthly payments from

  £555 to £618

  Product fee from

  No fee to £995

All very confusing!!

K_S

@scoey8 If you've asked for a 3-year fix, that's probably why the broker came back with the rate for a 3 year fix.

I don't want to give you half-baked/misleading information based on the limited info in your posts and without knowing anything about the case.

I would recommend first ascertaining what is the "best rate" you can get direct with cashback (the broker can't get that info in most cases) and then take it to your broker and see what they can get for the same fix length and compare the two on an overall cost basis.

You can then make an informed judgement as to whether you want to use the services of a broker or not.

scoey8

Sounds good. Have a meeting with Halifax tomorrow so hopefully be able to get all the info. 

getmore4less

Crunch some numbers to see the effect of the cashback.

Looks like the 2 broker options for 3 years are(adding fees, make payment the same)

amount	rate	payment	owing
£129,000.00	1.57%	£520.17	£116,055.75
£129,999.00	1.36%	£520.17	£116,307.13

That's your starting point and the no fee works out with less debt after 3 years

The 5 year options  look like this with(broker 2 first)  (net fees for direct after cashback)
I am seeing 1.70% for the no fee not 1.61%

amount	rate	payment	owing
£129,000.00	1.70%	£528.13	£107,387.08
£129,999.00	1.49%	£528.13	£107,170.61
£128,250.00	1.70%	£528.13	£106,570.59
£129,245.00	1.49%	£528.13	£106,358.33

if we take out the no fee and use the lower payment

amount	rate	payment	owing
£129,999.00	1.49%	£519.30	£107,720.00
£129,245.00	1.49%	£519.30	£106,907.72

~£800 saved over 5 years  but you would  prefer 3 years

just to check the 1.61% for fee no fee if it does exist 

amount	rate	payment	owing
£129,995.00	1.49%	£528.13	£107,166.30
£129,000.00	1.61%	£528.13	£106,831.36
£129,000.00	1.70%	£528.13	£107,387.08

if we look at the 5year options at y3 against the broker 1.57%.

amount	rate	payment	owing
£129,000.00	1.57%	£528.13	£115,762.66
£129,245.00	1.49%	£528.13	£115,717.96
£128,250.00	1.61%	£528.13	£115,126.28
£128,250.00	1.70%	£528.13	£115,463.92

at year 3 if the 1.61% exists with £750 cashback there is a good saving not so much if just the 1.70% is available

As you say its down to why you prefer 3 over 5 and how easy it would be if you went direct.

you could look at the 2year options and change again sooner