Remortgage for 1year

dawnmm Forumite Posts: 3
Third Anniversary First Post
In December our 2 year fixed rate come to an end. We will only have 1year left on the mortgage. What would be the best option with interest rates increasing. Extend our mortgage so we can get a fixed rate, stick with variable rate for the year or see if there is a way to pay it all off( not sure we could afford all that amount but maybe most of it).


  • MattMattMattUK
    MattMattMattUK Forumite Posts: 7,228
    1,000 Posts Second Anniversary Name Dropper
    Without knowing how much you owe and your desired and maximum repayments then we will bot be able to help, can you provide some figures? 
  • zagubov
    zagubov Forumite Posts: 17,815
    Part of the Furniture 10,000 Posts Name Dropper Photogenic
    Is this an interest-only mortgage? If it was a repayment isn't it structured to pay off the balance?
    There is no honour to be had in not knowing a thing that can be known - Danny Baker
  • Edi81
    Edi81 Forumite Posts: 1,371
    Ninth Anniversary 1,000 Posts Name Dropper Combo Breaker
    Unless it’s interest only most of your payment is going toward the capital in the last year. 
  • dawnmm
    dawnmm Forumite Posts: 3
    Third Anniversary First Post
    Thank you for the replies so far. It is a repayment mortgage. I’m kicking myself now as when I got my last fixed rate I should of got a 3 year deal then that would of taken me up until the end of my mortgage term but instead I only fixed it for 2 years 🤦🏻‍♀️We will roughly have about £16,000 still left to pay on when this deal ends.
  • simon_or
    simon_or Forumite Posts: 890
    500 Posts First Anniversary Name Dropper
    edited 20 June at 7:53AM
    Does your bank offer a fee free tracker rate? If yes then see if you can extend (to however long the minimum mortgage length is) and switch to a fee free tracker and then pay it off as rapidly as you can. 

    If that's not an option then just pay off as much as you can on the first day of the variable rate and then keep overpaying as rapidly as possibly to minimise the time spent on the standard variable rate.

    Perhaps even look at using a credit card 0% offer to turbocharge your savings and boost the amount you can overpay on the mortgage.
  • HobgoblinBT
    HobgoblinBT Forumite Posts: 191
    Third Anniversary 100 Posts
    If you are due to repay £16,000 over a one year term on a capital repayment mortgage the effect of an interest rate rise will be negligible to your monthly repayments.  In your circumstances I would go for a fee free variable interest rate without penalties for overpayments.  
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