Shared ownership

Toffee5959

Hello

Happy New Year!

Trying to get my finances in order.
I currently pay a mortgage on 50% of my shared ownership flat, 36.5k left on the mortgage but the rate is variable at 8.74% now.

Flat is worth roughly £200k, I can stair case to 100%

I have savings of £46k earning 5% interest.

Can I remortgage my current mortgage to reduce the interest or do I need to staircase at the same time? Or anything different I should do?

Many Thanks
Toffee

grumbler

Not sure about remortgaging, but I think 8.74% implies a lot of flexibility in your mortgage. If so, it makes no sense to earn 5% on your savings while paying 8.74% on your debt. Use a (big) part of your savings to overpay your mortgage.

missile

What do you currently pay as rent on the share ownership? Is this why do you want to stair case i.e. increase your mortgage?

Have you asked your current lender to provide options to reduce your rate? 
When I was in a similar situation my lender offered me a new 2 year fix at 5.4%

You might consider changing mortgage provider? An offset mortgage could be a better option for you? Please be aware, you will likely incur re-valuation & set up fees.

I am in a similar situation, my mortgage rate increased on Jan 01st. I have decided to use my savings to pay off mortgage. Unless you need the cash(?) I would suggest you do same.

Mark_d

Toffee5959 said:

Hello

Happy New Year!

Trying to get my finances in order.
I currently pay a mortgage on 50% of my shared ownership flat, 36.5k left on the mortgage but the rate is variable at 8.74% now.

Flat is worth roughly £200k, I can stair case to 100%

I have savings of £46k earning 5% interest.

Can I remortgage my current mortgage to reduce the interest or do I need to staircase at the same time? Or anything different I should do?

Many Thanks
Toffee

8.74% is very high.  Suppose you could remortgage without staircasing, say with HSBC, maybe you could get a rate as low as 5%.

Why would you want to maintain a mortgage at 5% if you're not making more than this on your savings? I suggest you consider using your savings to repay your current mortgage entirely.