Should I remorgage and pay a £2753 ERC?

Sam22022

Thanks all for your replies,

I've worked out that going with the 1.49% over 5 years at £755pcm and by consolidating a loan(£9,590.94)and 3 credit cards that add up to around12k I will actually be better off monthly by £469 and I'll still have around 10k to do home improvements, so in theory the £2753 ECR would be recovered in 6 months.

Exodi

Sam22022 said:

Thanks all for your replies,

I've worked out that going with the 1.49% over 5 years at £755pcm and by consolidating a loan(£9,590.94)and 3 credit cards that add up to around12k I will actually be better off monthly by £469 and I'll still have around 10k to do home improvements, so in theory the £2753 ECR would be recovered in 6 months.

Wasn't worth doing a further advance and paying the ERC? I'm very suprised by that.

getmore4less

Sam22022 said:

Thanks all for your replies,

I've worked out that going with the 1.49% over 5 years at £755pcm and by consolidating a loan(£9,590.94)and 3 credit cards that add up to around12k I will actually be better off monthly by £469 and I'll still have around 10k to do home improvements, so in theory the £2753 ECR would be recovered in 6 months.

Might be an idea to show your working as you cannot just use the monthly payment reduction to work it out.
Your debt is moving go and continue to accrue interest for a lot longer

What rates are the loans and CC.

Sam22022

Exodi said:

Sam22022 said:

Thanks all for your replies,

I've worked out that going with the 1.49% over 5 years at £755pcm and by consolidating a loan(£9,590.94)and 3 credit cards that add up to around12k I will actually be better off monthly by £469 and I'll still have around 10k to do home improvements, so in theory the £2753 ECR would be recovered in 6 months.

Wasn't worth doing a further advance and paying the ERC? I'm very suprised by that.

What do you mean by doing a further advance?

The ERC is 2% until February 2023, the 1.49% rate I have locked in is valid until March so I have to complete in that time, the broker I'm with has made me aware that the 1.49 I have locked in is now looking more like 1.91%, I don't want to get to next February to find rates have risen even more, I get that this is all hyperthetical 

Sam22022

Loan is 2.76% until June 2024

330.46pcm

Cc are 0%

getmore4less

Sam22022 said:

Exodi said:

Sam22022 said:

Thanks all for your replies,

I've worked out that going with the 1.49% over 5 years at £755pcm and by consolidating a loan(£9,590.94)and 3 credit cards that add up to around12k I will actually be better off monthly by £469 and I'll still have around 10k to do home improvements, so in theory the £2753 ECR would be recovered in 6 months.

Wasn't worth doing a further advance and paying the ERC? I'm very suprised by that.

What do you mean by doing a further advance?

The ERC is 2% until February 2023, the 1.49% rate I have locked in is valid until March so I have to complete in that time, the broker I'm with has made me aware that the 1.49 I have locked in is now looking more like 1.91%, I don't want to get to next February to find rates have risen even more, I get that this is all hyperthetical 

The key data point is if you switch now the rate next year needs to be below 1.6%/1.8% (depending on fee) to have been better off staying with what you have.

Still surprised there was not a fee option at a lower rate that would have been better than the no fee on £170k over 5y.

Thrugelmir

getmore4less said:

Thrugelmir said:

How much debt are you looking to consolidate? Generally speaking mortgage lenders will decline additional lending for this purpose. 

they already have an mortgage offer for £170k


Bluebell1000 said:

Does your ERC go down to 1% from Feb 22? That would change the calculations.

You may be able to port your mortgage if you move (i.e. take it with you) and borrow extra at that point if the house you wish to buy is more expensive.

it does make a big difference if the ERC drops to 1%

Save and extra £900 on top of paying the ERC back then needs rates to drop in the next 12 months to make sticking worth while.

Doing it for no fee 1% ERC.

Mortgage	£137,669
payment	£650	ERC/FEE
rate	3.15%	£1,377
new rate	1.49%	£0
Time	Years	months
Left on current	0	12
New fix term	5	0
amount left after(months)		12
Start	rate	End
£137,669	3.15%	£134,155
£139,046	1.49%	£133,279
amount left after(months)		60
£137,669	3.15%	£118,940
£139,046	1.49%	£109,330
Switch when ERC £0
Break even rate needed no fee and fee)		48
£134,155	1.305%	£109,330

The extra borrowing is a different calc.

if moving will the money for refurb help the price. 

Moving complicates 

Normally when applying for a mortgage a specific product is choosen. Unusual to have a choice of two. I therefore read the post as being the options that the MB has found rather than that a formal offer is on the table. 

Sam22022

Thrugelmir said:

getmore4less said:

Thrugelmir said:

How much debt are you looking to consolidate? Generally speaking mortgage lenders will decline additional lending for this purpose. 

they already have an mortgage offer for £170k


Bluebell1000 said:

Does your ERC go down to 1% from Feb 22? That would change the calculations.

You may be able to port your mortgage if you move (i.e. take it with you) and borrow extra at that point if the house you wish to buy is more expensive.

it does make a big difference if the ERC drops to 1%

Save and extra £900 on top of paying the ERC back then needs rates to drop in the next 12 months to make sticking worth while.

Doing it for no fee 1% ERC.

Mortgage	£137,669
payment	£650	ERC/FEE
rate	3.15%	£1,377
new rate	1.49%	£0
Time	Years	months
Left on current	0	12
New fix term	5	0
amount left after(months)		12
Start	rate	End
£137,669	3.15%	£134,155
£139,046	1.49%	£133,279
amount left after(months)		60
£137,669	3.15%	£118,940
£139,046	1.49%	£109,330
Switch when ERC £0
Break even rate needed no fee and fee)		48
£134,155	1.305%	£109,330

The extra borrowing is a different calc.

if moving will the money for refurb help the price. 

Moving complicates 

Normally when applying for a mortgage a specific product is choosen. Unusual to have a choice of two. I therefore read the post as being the options that the MB has found rather than that a formal offer is on the table. 

The 1.49% is locked in as we've suited all paperwork etc it was only because I wanted to see what else was there he came back with the 1.71% but that could've potentially gone again. 

Sam22022

Submitted... 

Sam22022

There's nothing I can get that's lower than the 1.49% 5 year fix with no fees.

A mortage advisor wouldn't not get me the best deal possible I'm sure?