Rolling 2 mortgages into 1

Hi All,
I am looking for some re-mortgaging advice so hopefully someone can advise.
  • House is worth around 1,000,000 (mid range for the road we live on)
  • We initially took out a 29 year mortgage on our house in 2021 and got a 5 year fixed rate at 1.5% (balance is around 350k).  
  • We then took out a 2nd charge mortgage in 2022 which is coming to the end soon (2yr fixed at 3.99% for 100k.  
  • My question is around rolling the two in together.
  • Am I better off keeping the original 1.5% one separate as would lose the interest rate and there are penalties involved for coming out early (3% with 3 years remaining\2% with 2 years remaining)?
  • I am unsure whether to try and take another fixed rate 2nd charge mortgage out again as the rates are so high (got offered a 9.1% rate by current 2nd charge company for a 2 year fix) but would it work out better in the long run if we lose our 1.5% and just consolidate into 1 mortgage?

Any information appreciated.

Comments

  • london21
    london21 Posts: 2,089
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    Unless you move into a new lender will always be 2 separate mortgages. 
  • Thanks, I wanted to know would it be financially better in the long run to
    ->leave our current mortgage provider and rate and negotiate a new deal on the combined amount (with penalties) 
    ->or if we should just find a 2nd charge provider to run alongside our main mortgage and accept the high rates until our 5 year fixed ends?

    When I looked at our mortgage providers mortgage page for the combined amount it is showing around 4.6% for the same time and period. Is a mortgage advisor the best option for this question?
  • dimbo61
    dimbo61 Posts: 13,709
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    With that size of mortgage could you find a whole of market mortgage broker to shop round for you ?
    Any way you can borrow the outstanding debt on the smaller mortgage from family or friends ? or speak to your current lender ( with the big mortgage at 1.5% ) and see if they will give you additional  lending to cover the £100K.
    Pay down whatever you can each month on the 3.99% deal.

  • Hoenir
    Hoenir Posts: 1,152
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    With a rate of 1.5% on the bulk of your mortgage debt. Leave as is. 

    Have you approached the lender above, to see what rate they'll offer on the £100k of debt.  
  • amnblog
    amnblog Posts: 12,385
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    Three quarters of your borrowing is on 1.5% until 2026 this is a third of the rates currently available.

    I really do not see what you are trying to achieve here?
    I am a Mortgage Broker

    You should note that this site doesn't check my status as a Mortgage Broker, 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.
  • Thanks for the advice.  I think the main thing I was trying to find out was if it was financially worthwhile coming out of our existing mortgage and rolling them together rather than having to relook for another 2nd charge.  e.g. Rolling the two and having a rate of 4.6 vs keeping it as it is and having a rate of 1.5% and 9.1%

    But as mentioned above the 1.5% is on the larger amount so will keep this rate for as long as possible and will see what my current lender can offer in relation to the 100k.

    Thanks all
  • amnblog
    amnblog Posts: 12,385
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    edited 19 December 2023 at 9:53AM
    You should be able to raise a further advance with your main lender at a rate of around 5% to repay the second charge. That will save you £4,000 a year.
    I am a Mortgage Broker

    You should note that this site doesn't check my status as a Mortgage Broker, 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.
  • I will be in virtually the same situation as you, next year, when my smaller mortgage comes out of fixed. Can’t you keep that on SVR until 26 then remortgage the whole lot? 
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