Too soon to do product transfer?

Mark_84

My current mortgage deal ends in September.

I currently have a deal locked in with Coventry Building Society for 3.96% on a 5 year fix but with a £999 fee.

My existing lender has a product transfer for 4.03% with no fees which works out better over the 5 years.

I went to apply this evening and it states I can’t cancel or change deal again once I do this.

I assumed it would be like a mortgage offer and valid until September.

I have locked the rate in for 14 days but didn’t know if I should apply this early?

I doubt rates will increase much by September?

There is a similar rate with Lloyds that I could apply for and get a mortgage offer and then leave the product transfer until last minute in case rates change?

dimbo61

I wonder how much difference the 3.96% fix with £999 fee and the fee free 4.03% really makes !
Sticking with your existing lender would involve a few clicks on the computer and maybe a form to sign rather than a full mortgage application with another lender.
Rates have gone up but are still very low compared to historic levels.
We overpaid every month to clear our mortgage debt asap and not pay as much Interest
Decisions decisions

housebuyer143

Why don't you just wait until closer to the time if you don't feel like rates will increase? Product transfer in a few months?

dunstonh

I doubt rates will increase much by September?

US just increased its rates yesterday.  That increases the pressure on the rest of the world to follow.  Plus, inflation in the UK is not coming down as expected.    So, another 1 or 2 increases before September could occur.

housebuyer143

dunstonh said:

I doubt rates will increase much by September?

US just increased its rates yesterday.  That increases the pressure on the rest of the world to follow.  Plus, inflation in the UK is not coming down as expected.    So, another 1 or 2 increases before September could occur.

Yes but the base rate rise does not correspond with mortgage rate rises. This is based on swap rates, which is why many fixed rates are below base rate.

dunstonh

housebuyer143 said:

dunstonh said:

I doubt rates will increase much by September?

US just increased its rates yesterday.  That increases the pressure on the rest of the world to follow.  Plus, inflation in the UK is not coming down as expected.    So, another 1 or 2 increases before September could occur.

Yes but the base rate rise does not correspond with mortgage rate rises. This is based on swap rates, which is why many fixed rates are below base rate.

Correct.   However, swap rates are influenced by the market expectations of what interest rates will do in the future.          And the deals are based on the expectation over the term of the deal.       As expectations have recently moved from thinking we were at the peak and would start to see a fall to not quite being at the peak and the fall may take a bit longer, that could have an influence on the swap rates.

Mark_84

I think I will keep an eye on the rates. I don’t want to lock in the product transfer right now but also don’t want to miss a decent rate with no fees if they get pulled in the next few months.

I still have the rate with fees locked in worst case but ideally I want a decent one without fees.

amnblog

You can swop the rate once secured if a better one comes along before September.

We do this regularly for Clients.

Speak to a Broker.

Wongus

Mark_84 said:

I think I will keep an eye on the rates. I don’t want to lock in the product transfer right now but also don’t want to miss a decent rate with no fees if they get pulled in the next few months.

I still have the rate with fees locked in worst case but ideally I want a decent one without fees.

I am in the same position, as the product transfer offer is valid for 14 days, I've been sitting on offers until day 14, I then log on to see if the offer is still available at which point I generate a new offer which gives me another 14 days. I'll keep doing this until the rate moves against me. 

Mark_84

Wongus said:

Mark_84 said:

I think I will keep an eye on the rates. I don’t want to lock in the product transfer right now but also don’t want to miss a decent rate with no fees if they get pulled in the next few months.

I still have the rate with fees locked in worst case but ideally I want a decent one without fees.

I am in the same position, as the product transfer offer is valid for 14 days, I've been sitting on offers until day 14, I then log on to see if the offer is still available at which point I generate a new offer which gives me another 14 days. I'll keep doing this until the rate moves against me. 

That might be what I keep doing along side the mortgage offer I already have with a different lender..

The product transfer is better due to less fees but you can’t lock it in like you can do with a full mortgage offer.

Wongus

Mark_84 said:

Wongus said:

Mark_84 said:

I think I will keep an eye on the rates. I don’t want to lock in the product transfer right now but also don’t want to miss a decent rate with no fees if they get pulled in the next few months.

I still have the rate with fees locked in worst case but ideally I want a decent one without fees.

I am in the same position, as the product transfer offer is valid for 14 days, I've been sitting on offers until day 14, I then log on to see if the offer is still available at which point I generate a new offer which gives me another 14 days. I'll keep doing this until the rate moves against me. 

That might be what I keep doing along side the mortgage offer I already have with a different lender..

The product transfer is better due to less fees but you can’t lock it in like you can do with a full mortgage offer.

I also looked at moving to another lender via a broker, however the savings on rates isn't that substantial when factoring in all the fees (product, exit, entry), plus dealing with tree diagram underwriters has a cost in life expectancy! So easier to stay with the current lender, based on the rates/fees it looks like you are with Santander also, their fee free product transfers are not to be underestimated.