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Bank loan to pay off mortgage?
Louisfrenchie
Posts: 3 Newbie
Hello All!
With all the worry about rising interest rates and mortgage deals being pulled, I am on a tracker deal 0.74% above base, and thinking on best course of action.
I have 4yrs left and approx £23k remaining on my mortgage.....wondering if a fixed rate loan (can get 3.3%) is way to go to pay off mortgage early and have certainty of the fixed payment.
Has anyone else used a bank loan to pay off remaining mortgage balance? Are there any downsides to this?
TIA
With all the worry about rising interest rates and mortgage deals being pulled, I am on a tracker deal 0.74% above base, and thinking on best course of action.
I have 4yrs left and approx £23k remaining on my mortgage.....wondering if a fixed rate loan (can get 3.3%) is way to go to pay off mortgage early and have certainty of the fixed payment.
Has anyone else used a bank loan to pay off remaining mortgage balance? Are there any downsides to this?
TIA
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Comments
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If you can get 3% on the loan and commit to paying it all off within the time then I'd say it's a no-brainer. Will be in a similar situation in 2025 and looking at ways to get that last £20k paid off after the switch ends. If a 3.3% personal loan was available I'd snap it up.
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Just don’t tell anyone it’s to pay off your mortgage and you’ll be fine… new car did you say?0
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Is it not allowed?0
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Well I guess you're moving from secured to unsecured borrowing so the bank might not want that to happen. Check the T&CsLouisfrenchie said:Is it not allowed?Remember the saying: if it looks too good to be true it almost certainly is.0 -
I work for a high street bank. If you tell them it’s to pay off your mortgage you won’t be approved.Louisfrenchie said:Is it not allowed?1 -
Out of interest, why is that? Is it to do with secured/unsecured status?0
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More or less.0
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I never considered the unsecured aspect! Okay, so say it's for home improvements.
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Why, if the borrowing is unsecured against a car or a house it is still unsecured.jimjames said:
Well I guess you're moving from secured to unsecured borrowing so the bank might not want that to happen. Check the T&CsLouisfrenchie said:Is it not allowed?
Secured loan gets paid off, they are happy.
Unsecured does it matter, they had a risk when they extended the funds how has that risk changed?
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Any default and they'd secure it anyway by way of a Charging Order against your house.Louisfrenchie said:Out of interest, why is that? Is it to do with secured/unsecured status?0
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