We're aware that some users are experiencing technical issues which the team are working to resolve. See the Community Noticeboard for more info. Thank you for your patience.
📨 Have you signed up to the Forum's new Email Digest yet? Get a selection of trending threads sent straight to your inbox daily, weekly or monthly!

Should I sit tight on current mortgage or jump early?

Options

After some re-mortgage advice if possible, please. I'm trying to see if I will be better off getting a new 5yr deal early and paying the clause as I’m worried interest rates could be much higher than they are now come the end of my current deal next year.

Figures:

House value £450,000, by end of current mortgage deal there will be £220,000 outstanding.

I have some savings, was going to pay an extra £20,000 off come re-mortgage time.

15 months remaining on current mortgage, fixed rate of 1.92%, repayments of £940ish pcm.

Early buy out clause £3,900.

Have looked on Martin Lewis mortgage tool today and new 5yr deal with The Cumberland of 2.11% for 5yrs @ £1024pcm for the remaining £200,000.

Should I sit tight or jump early?

Comments

  • Thrugelmir
    Thrugelmir Posts: 89,546 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Photogenic
    Have you factored in all the costs associated with remortgaging? 

    How would you fund the ERC? 
  • getmore4less
    getmore4less Posts: 46,882 Forumite
    Part of the Furniture 10,000 Posts Name Dropper I've helped Parliament
    lender and ERC rate?

    does the erc drop in a few months?

    Any fees?

    full term left

    the numbers don't seem to add up

    if it is going to be £220k at the end of the deal in 15months  what's it now if you jump ship.

    if £200k at 2.11% is £1,024pm that's 20years full term

    to get to £220k in 15months at 1.92% that's £232k now

    to have a payment of £940  that's more like a 26y term 

    knocking £16k(20-4) off with that rate increase the payment should go down not up




  • Also, have you factored in actually getting that 1.92% rate? When I looked a week or so ago, you couldn’t get a phone appointment with Cumberland for weeks. Likely scenario, you’re looking at around 2.24%+ now, with the lowest lenders on a five year deal. 
Meet your Ambassadors

🚀 Getting Started

Hi new member!

Our Getting Started Guide will help you get the most out of the Forum

Categories

  • All Categories
  • 350.7K Banking & Borrowing
  • 253K Reduce Debt & Boost Income
  • 453.4K Spending & Discounts
  • 243.7K Work, Benefits & Business
  • 598.5K Mortgages, Homes & Bills
  • 176.8K Life & Family
  • 256.9K Travel & Transport
  • 1.5M Hobbies & Leisure
  • 16.1K Discuss & Feedback
  • 37.6K Read-Only Boards

Is this how you want to be seen?

We see you are using a default avatar. It takes only a few seconds to pick a picture.