What would you do?

I would appreciate your advice o:) :
I own a second property and have an interest only 8 year mortgage and the two year fix ends Dec 31st. 
1. I could renew mortgage with another 2 year fix at 6.33%
2. I have sufficient cash to repay the mortgage, but that would reduce my instant cash available to a level I am not comfortable with.
3. I could obtain a personal loan at 6.4% to give me a comfortable cash on hand.

I feel inclined toward option two.

"A nation's greatness is measured by how it treats its weakest members." ~ Mahatma Gandhi
Ride hard or stay home :iloveyou:

Comments

  • silvercar
    silvercar Posts: 46,721
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    Option 4. Get an offset mortgage. Put all your savings into the offset account, so pay zero interest on your mortgage but know the money is available should you need it.
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  • 400ixl
    400ixl Posts: 2,593
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    Why not a mix of 1 and 2. Reduce the mortgage to a level that you would can keep a cash reserve you are comfortable with.
  • missile
    missile Posts: 11,678
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    Hi, Thanks for your suggestions, please be advised:

    To get an offset mortgage / a provider with better rate I would have to change provider. If I change Mortgage Provider, I would have arrangement & revaluation fees.

    Re-mortgage at a reduced level is a sensible option. I intend to sell property as and when it becomes vacant. I would still have to abide by conditions and if within 2 years I would have penalty charge.


    "A nation's greatness is measured by how it treats its weakest members." ~ Mahatma Gandhi
    Ride hard or stay home :iloveyou:
  • kingstreet
    kingstreet Posts: 38,595
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    missile said:
    Hi, Thanks for your suggestions, please be advised:

    To get an offset mortgage / a provider with better rate I would have to change provider. If I change Mortgage Provider, I would have arrangement & revaluation fees.

    Re-mortgage at a reduced level is a sensible option. I intend to sell property as and when it becomes vacant. I would still have to abide by conditions and if within 2 years I would have penalty charge.


    There are fee-free options and also products with no ERCs.
    I am a mortgage broker. You should note that this site doesn't check my status as a Mortgage Adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice. Please do not send PMs asking for one-to-one-advice, or representation.
  • missile
    missile Posts: 11,678
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    missile said:
    Hi, Thanks for your suggestions, please be advised:

    To get an offset mortgage / a provider with better rate I would have to change provider. If I change Mortgage Provider, I would have arrangement & revaluation fees.

    Re-mortgage at a reduced level is a sensible option. I intend to sell property as and when it becomes vacant. I would still have to abide by conditions and if within 2 years I would have penalty charge.


    There are fee-free options and also products with no ERCs.
    My IFA and I have not found any of those which offer a better rate than 6.33%
    "A nation's greatness is measured by how it treats its weakest members." ~ Mahatma Gandhi
    Ride hard or stay home :iloveyou:
  • penners324
    penners324 Posts: 2,571
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    missile said:
    missile said:
    Hi, Thanks for your suggestions, please be advised:

    To get an offset mortgage / a provider with better rate I would have to change provider. If I change Mortgage Provider, I would have arrangement & revaluation fees.

    Re-mortgage at a reduced level is a sensible option. I intend to sell property as and when it becomes vacant. I would still have to abide by conditions and if within 2 years I would have penalty charge.


    There are fee-free options and also products with no ERCs.
    My IFA and I have not found any of those which offer a better rate than 6.33%
    Go to a mortgage broker 
  • missile
    missile Posts: 11,678
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    My IFA is a mortgage broker. 
    "A nation's greatness is measured by how it treats its weakest members." ~ Mahatma Gandhi
    Ride hard or stay home :iloveyou:
  • Well, if the question is what would I do?
    I would pay it off.

    You say you can access money on similar rate if needed (3), I assume you have income - so could save more for the first few months to get yourself to comfortable place. You'd be saving quicker as you won't be paying any interests.
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