Mortgage Advice

greenplant12

I was hoping for some advice on my situation and what you would do.

We are currently in the process of buying and selling. We had a mortgage offer from Halifax with a rate of 5.09% (LTV 70.97%). Halifax dropped their rates on the 2nd of October, so I contacted our broker who had this amended to the new rate of 4.93%. However, I can see that Halifax have again dropped their rate to 4.85%. I was about to contact our broker to amend this again, but wanted advice before I do this.

Our current mortgage is with Lloyds (£66k), and is fixed until end of April 2024. We could have ported this, but decided to go with Halifax as 1) Lloyds mortgage rates at the time were high, 2) Our broker wasn't able to offer a mortgage with Lloyds and 3) I thought if I port the mortgage, I would constantly have 2 different dates whereby I have to sort a fix. However, both myself and my partner are signed up to Club Lloyds who are now offering a rate of 4.80%. 

I am worried that getting an offer from Lloyds with impact our credit negatively, as Halifax have already carried out 2 hard searches (original offer, revised lower rate offer).

My question is what would you do in this situation? Would you stick with Halifax and pay Lloyds an ERC charge (2%) with a rate of 4.85% or get an offer from Club Lloyds with a rate of 4.80% and port the remainder? If there are any details missing that would help form an opinion, please let me know.

Appreciate anyone's advice. Thanks!

ACG

My advice (although probably biased) would be to speak to your broker. 
They can do the sums for you and you can decide if saving £x pm is worth the hassle/risk. 

I had a customer last month who wanted to switch products to say 18p pm on a 2 year fixed rate. It was not worth the hassle/work so I just knocked a fiver off our bill. If it had been £180 pm, then I would have obviously done the work. 

Chances are though yours will fall somewhere in the middle. There is a line where it goes from being worth it to not. 

greenplant12

ACG said:

My advice (although probably biased) would be to speak to your broker. 
They can do the sums for you and you can decide if saving £x pm is worth the hassle/risk. 

I had a customer last month who wanted to switch products to say 18p pm on a 2 year fixed rate. It was not worth the hassle/work so I just knocked a fiver off our bill. If it had been £180 pm, then I would have obviously done the work. 

Chances are though yours will fall somewhere in the middle. There is a line where it goes from being worth it to not. 

HI ACG,

Thanks for taking the time to reply.

I haven't asked my broker as it is in their interest for me to pick the Halifax mortgage as they then get their fee.

I totally understand the headache for a small amount, but as the ERC is approx £1,400 plus Halifax's rate is now £7pm more than Lloyds (completely get this is nothing in the grand scheme of things), would it be stupid for me to not approach Lloyds?

Also, apologies for my naivety, but if I port the mortgage, does this mean that I have to secure another mortgage at the end of April 2024 when the fix ends for the smaller amount? So I will actually have 2 separate mortgages at one time? Again, my apologies for what is no doubt a stupid question- I'm just quite confused.