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How bad is moving to the standard mortgage rate?
CapabilityJones
Posts: 12 Forumite
My 2 year fixed rate term with Nationwide is coming to an end in September this year. I'm dating someone who also has a mortgage and his house is bigger and in a better location than mine so if we were going to be move in together it would make more sense for me to sell and live with him, but we're not quite there yet.
If I get to September and we still need a few months to figure things out, how bad will it be to go onto the standard rate instead of fixing again? Most fixes are at least two years which is far too long, but I'm not sure when within the year we might decide to make the leap. Will my monthly payments be hugely different? I'm on 1.54% at the moment, but when the fix ends it'll go up to 3.99%. I don't entirely understand how that'll affect my payments - will they double with the interest rate?
If I get to September and we still need a few months to figure things out, how bad will it be to go onto the standard rate instead of fixing again? Most fixes are at least two years which is far too long, but I'm not sure when within the year we might decide to make the leap. Will my monthly payments be hugely different? I'm on 1.54% at the moment, but when the fix ends it'll go up to 3.99%. I don't entirely understand how that'll affect my payments - will they double with the interest rate?
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How much do you owe on your mortgage and what's the remaining term in years.0
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It's shared ownership, I have £52k left and the remaining term is about 16 years.Thrugelmir said:How much do you owe on your mortgage and what's the remaining term in years.0 -
rate fees payment 1.54% £0.00 £305.74 3.99% £0.00 £366.85
over 1 year paying the sameamount rate payment owing £52,000.00 1.54% £366.85 £48,373.01 £52,000.00 3.99% £366.85 £49,629.50
~£1,260 more debt
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getmore4less said:
rate fees payment 1.54% £0.00 £305.74 3.99% £0.00 £366.85
over 1 year paying the sameamount rate payment owing £52,000.00 1.54% £366.85 £48,373.01 £52,000.00 3.99% £366.85 £49,629.50
~£1,260 more debt
This is very helpful, thank you! So if I stayed on the standard rate for a couple of months I'd be paying about £60 a month more. That's really useful to know, I can afford that - it's not ideal long term but I'm not expecting it to be more than 3-4 months extra.0 -
You can also switch to a tracker product with no early repayment charge. It will be lower than standard variable rate will not tie you in so can sell any time as no penalty for paying off. Check if your bank have that to switch to as a productInitial mortgage bal £487.5k, current £258k, target £243,750(halfway!)
Mortgage start date first week of July 2019,
Mortgage term 23yrs(end of June 2042🙇🏽♀️),Target is to pay it off in 10years(by 2030🥳).MFW#10 (2022/23 mfw#34)(2021 mfw#47)(2020 mfw#136)
£12K in 2021 #54 (in 2020 #148)
MFiT-T6#27
To save £100K in 48months start 01/07/2020 Achieved 30/05/2023 👯♀️
Am a single mom of 4.Do not wait to buy a property, Buy a property and wait. 🤓0 -
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This was what I was going to suggest. We did the same in 2020 when we knew we were selling within a few months.Sistergold said:You can also switch to a tracker product with no early repayment charge. It will be lower than standard variable rate will not tie you in so can sell any time as no penalty for paying off. Check if your bank have that to switch to as a product0
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