Variable or fixed as first time buyer?

housebuyer143

Bookowl said:

simon_or said:

Is it a discounted variable or a tracker variable? If it's 3.15% I think it's a discounted.

I would go for the 3.15% discounted.

It’s on a tracker variable if that makes a difference?

That doesn't make sense. If it's a tracker, and tracks base that rate no longer exists as no base rate trackers available now are going to be less than 3.7%-3.8%.
If it's a discount tracker it could potentially be that rate. It doesn't track base rate if that's the case, it is discounted off the lenders SVR which can go up and down with no set pattern. Base rate could go down but if the SVR doesn't then you don't pay less, similarly the lenders SVR might be 5.49% today, but tomorrow could be 6.49% and you are paying 1% more.

Martisha

snowqueen555 said:

I am going for the 5 year deal. I'm going for 5.39% (30yrs).

The amount of the principle being paid off is so small in the first 5 years, it is a bit worrying. After a year I will be overpaying for 4 years before remortgaging.

I have gone for the same deal as you.

Where did you get the figure of capital repayment after 5 years please?

K_S

Martisha said:

snowqueen555 said:

I am going for the 5 year deal. I'm going for 5.39% (30yrs).

The amount of the principle being paid off is so small in the first 5 years, it is a bit worrying. After a year I will be overpaying for 4 years before remortgaging.

I have gone for the same deal as you.

Where did you get the figure of capital repayment after 5 years please?

@martisha If you look at your mortgage illustration/KFI/quote (should have been shared with you by your broker or lender prior to application), it should have a payment schedule while lays it out month by month. It'll look like something like this and should clearly show a breakdown of each month's payment - how much of it goes towards paying capital and how much towards interest.

Bookowl

Just having a think, it’s such a minefield.
I’m on a low wage and so having to put £44k down. With a variable rate may go down or up.
If I wait until next year I worry that if interest rates go down next year the house prices will rise again and I won’t be able to afford to buy.

In my area the houses were placed on the market at £120k and going up to £140-£150k in April / may of this year with bidding wars and too many people.

In comparison last year my brother put £20k down on a house at £123,500k.

I don’t plan to be in rubbish wage forever.
 But it’s really daunting doing it all on your own.

Do I wait until next year with a higher paying job or take a gamble on this house?

Any help most appreciated.

simon_or

Bookowl said:

simon_or said:

Is it a discounted variable or a tracker variable? If it's 3.15% I think it's a discounted.

I would go for the 3.15% discounted.

It’s on a tracker variable if that makes a difference?

It can't be a tracker, ask your broker again. If it was a 3.15% tracker it would be the bank of england rate plus 0.15%, a no brainer!

Bookowl

simon_or said:

Bookowl said:

simon_or said:

Is it a discounted variable or a tracker variable? If it's 3.15% I think it's a discounted.

I would go for the 3.15% discounted.

It’s on a tracker variable if that makes a difference?

It can't be a tracker, ask your broker again. If it was a 3.15% tracker it would be the bank of england rate plus 0.15%, a no brainer!

It is a tracker, my broker gave me an illustration of deals available and it was with NatWest as of 8th November with a 3.15% variable with repayments of £348 per month

Martisha

K_S said:

Martisha said:

snowqueen555 said:

I am going for the 5 year deal. I'm going for 5.39% (30yrs).

The amount of the principle being paid off is so small in the first 5 years, it is a bit worrying. After a year I will be overpaying for 4 years before remortgaging.

I have gone for the same deal as you.

Where did you get the figure of capital repayment after 5 years please?

@martisha If you look at your mortgage illustration/KFI/quote (should have been shared with you by your broker or lender prior to application), it should have a payment schedule while lays it out month by month. It'll look like something like this and should clearly show a breakdown of each month's payment - how much of it goes towards paying capital and how much towards interest.

Thank you for this, but the illustration my broker provided does not have an example above. Why this could be and how can I obtain one?
its with Nationwide

K_S

Martisha said:

K_S said:

Martisha said:

snowqueen555 said:

I am going for the 5 year deal. I'm going for 5.39% (30yrs).

The amount of the principle being paid off is so small in the first 5 years, it is a bit worrying. After a year I will be overpaying for 4 years before remortgaging.

I have gone for the same deal as you.

Where did you get the figure of capital repayment after 5 years please?

@martisha If you look at your mortgage illustration/KFI/quote (should have been shared with you by your broker or lender prior to application), it should have a payment schedule while lays it out month by month. It'll look like something like this and should clearly show a breakdown of each month's payment - how much of it goes towards paying capital and how much towards interest.

Thank you for this, but the illustration my broker provided does not have an example above. Why this could be and how can I obtain one?
its with Nationwide

@martisha The excerpt I posted above is from an illustration for a Nationwide product, albeit one generated by my sourcing system, perhaps your broker uses another sourcing system or sent you the Nationwide generated illustration which does not include a payment schedule.

That's not an issue though, you could use this calculator (or any similar one on Google) to plug in your numbers and get the same schedule showing breakdown of capital and interest payment.

K_S

Bookowl said:

simon_or said:

Bookowl said:

simon_or said:

Is it a discounted variable or a tracker variable? If it's 3.15% I think it's a discounted.

I would go for the 3.15% discounted.

It’s on a tracker variable if that makes a difference?

It can't be a tracker, ask your broker again. If it was a 3.15% tracker it would be the bank of england rate plus 0.15%, a no brainer!

It is a tracker, my broker gave me an illustration of deals available and it was with NatWest as of 8th November with a 3.15% variable with repayments of £348 per month

@bookowl As I mentioned above, I'm afraid it'll be 3.90% (BOE rate of 3% + 0.90% tracker margin) or 3.89% from today, your broker should have explained that.

It's showing as 3.15% as the NatWest product guide is still stuck on the BOE rate of 2.25% giving you 2.25 + 0.9 = 3.15%.

K_S said:

Bookowl said:

simon_or said:

Is it a discounted variable or a tracker variable? If it's 3.15% I think it's a discounted.

I would go for the 3.15% discounted.

It’s on a tracker variable if that makes a difference?

@bookowl If it's a NatWest 75% LTV tracker quoted at 3.15%, that's probably a sourcing error which is still using the old BOE rate of 2.25% instead of 3%. If it's that product (NatWest BOE+0.90% tracker), it *should* be 3.90% (or 3.89% from tomorrow as they're dropping slightly).

You should ask your broker to source again tomorrow as some other mainstream lender tracker rates are falling further so worth a review.

Martisha

K_S said:

Martisha said:

K_S said:

Martisha said:

snowqueen555 said:

I am going for the 5 year deal. I'm going for 5.39% (30yrs).

The amount of the principle being paid off is so small in the first 5 years, it is a bit worrying. After a year I will be overpaying for 4 years before remortgaging.

I have gone for the same deal as you.

Where did you get the figure of capital repayment after 5 years please?

@martisha If you look at your mortgage illustration/KFI/quote (should have been shared with you by your broker or lender prior to application), it should have a payment schedule while lays it out month by month. It'll look like something like this and should clearly show a breakdown of each month's payment - how much of it goes towards paying capital and how much towards interest.

Thank you for this, but the illustration my broker provided does not have an example above. Why this could be and how can I obtain one?
its with Nationwide

@martisha The excerpt I posted above is from an illustration for a Nationwide product, albeit one generated by my sourcing system, perhaps your broker uses another sourcing system or sent you the Nationwide generated illustration which does not include a payment schedule.

That's not an issue though, you could use this calculator (or any similar one on Google) to plug in your numbers and get the same schedule showing breakdown of capital and interest payment.

This is very helpful.
thank you very much!