Nearly there.. .

_Nicola_Jane_

Hi, I'm working my way to becoming mortgage free. My fixed rate term expires at the end of the year by then I'll have approx £5k left. I'm wondering if it's worth getting a credit card to pay this final bit off rather than remortgage for another few months? I'm not sure how it works transferring £5k to my current account. would it be worthwhile? Would I incur a fee that would end up costing more than the mortgage interest rate? Any advice is appreciated. Thank you.

Thriftmaster1973

I thought once the fix has ended you could pay balance off in full.

Thriftmaster1973

Would not entertain a credit card btw.

_Nicola_Jane_

@Thriftmaster1973 thank you. 
I have made the maximum overpayments and will pay all of my savings in the last month but will just be short approx £5k 

South_coast

I don't think you'll be able to get a new mortgage deal. Most lenders have a minimum amount they'll lend (I was with NatWest and theirs was £30k). You'll probably just have to go onto your current lender's SVR until the balance is cleared. You could get a money transfer card and use that to pay it off, but you'd then need to clear it before the introductory period ends, plus there'll be a fee to pay. You'll need to crunch the numbers, but there's probably not much in it on a balance that size. 

Well done for getting this far!

jimjames

South_coast said:

I don't think you'll be able to get a new mortgage deal. Most lenders have a minimum amount they'll lend (I was with NatWest and theirs was £30k). You'll probably just have to go onto your current lender's SVR until the balance is cleared. You could get a money transfer card and use that to pay it off, but you'd then need to clear it before the introductory period ends, plus there'll be a fee to pay. You'll need to crunch the numbers, but there's probably not much in it on a balance that size. 

Well done for getting this far!

There should be no issue switching to a new rate with the same bank. It's applying for a brand new one that would be an issue. 

I'd pay off what you can and then switch to the lowest 1 or 2 year fixed rate for the balance with the knowledge that 10% overpayment will probably clear it sooner. Credit card seems a very bad idea when it's just shifting debt from one place to another. There isn't any point being mortgage free but having card debts.

powerspowers

Hi Nicola! Wow you are really close now- well done!! 

Not sure what your options are really- remortgaging with another bank will be tough as it’s so low so I’d talk to yours and see what they can offer. I know other lenders are reluctant to lend for mortgage debt but it may be better than your mortgage interest rate after the fix term ends.  It may be a case of take the hit on the interest, it shouldn’t be massive if you pay it off fairly quickly 

Thriftmaster1973

Owing that low amount will make the banks SVR amount to pittence, it's not worth worrying about.

The time to be concerned about SVR's is when you owe over 20k - that's when you can notice the higher payment compared to fixed.