Remortgage query!

Globemaster

Hello all. Got a question or 2 about an upcoming renewal.

History. 
I took a mortgage out with HSBC for £75,725 on 1/11/19 for 14y 5m (ends 1/4/34) with a fixed rate of 1.99% that ends 31st July 2024 paying £501/mth.
The amount left will be £16,000 when the fixed term ends in July 2024.
I'm 52 and other half is 44, both in full employment.

Do I
1a). Get a fixed term over 3 years at ?6% (est) and pay approx £487 and pay it off?
       b). Also Stopping overpaying like we are doing and save ourselves £660/mth.

2). Let the fixed rate end and continue on a standard variable rate?
     Reason being: The rate hopefully will be stable and predictions say over the next few years (possibly 4 to 5yrs) the rate may drop down to ?4% again.

NOTE
I've calculated (using the MSE calculator) a mortgage of £16,000 with a lowest possible rate of 4% would be £476/mth and highest / worst case at 9% would be £509/mth (paying £501/mth currently), so really the SVR is irrelevant as it's a nominal difference.   

I read somewhere, that not having a mortgage can adversely affect your credit score.
Keeping the mortgage open for a nominal amount, the bank keep your deeds safe.

Many thanks for reading and look forward to some people's point of view.

penners324

Get a tracker rate with no erc. Then you can continue overpaying. You're unlikely to find a savings account with a rate higher than a new mortgage rate, so aying off the mortgage ASAP is financially beneficial.

Though you should also consider putting some of the overpayment amounts into your pension. 

Forget the credit score, it's a made up number. 

housebuyer143

There are no deeds anymore to keep safe, they are all online and there is no benefit really to having a mortgage you don't need for your credit score. 

I personally would stop overpaying and put it in savings until your rate increases. 

In regards to remortgage, you might find it hard to do elsewhere because the loan amount and term is too low, so you should check with your current lender if they still allow you to product switch to this shorter term or not.

RedFraggle

I don't think you can get a mortgage for £16k so you may not have an option unless you borrow more than you need to. 

Bigphil1474

OP, see if you can get a good deal on a personal loan for the remaining £16k. We've been mortgage free for 3 years and has had no noticeable effect.