Retention mortgage rate from Santander

jmb1

Hi looking for advice. We have a 50k mortgage with 12 years remaining currently 4.64% 2 year fixed ending January 2025. Tried to view online but said to call which I just did and offered the following retention rates (all fixed, with no fees):
2yr @ 4.53
3yr @ 4.42
5yr @ 4.33

I have no idea how these fare in the market, can someone advise?

chanz4

Halifax offered us 4.11 5 year on 65k , that's 24% ltv

TheSpectator

jmb1 said:

Hi looking for advice. We have a 50k mortgage with 12 years remaining currently 4.64% 2 year fixed ending January 2025. Tried to view online but said to call which I just did and offered the following retention rates (all fixed, with no fees):
2yr @ 4.53
3yr @ 4.42
5yr @ 4.33

I have no idea how these fare in the market, can someone advise?

Use the MSE mortgage comparison tool?

lfc321

They're not market leading rates, but they're generally pretty par for the course. Given the circs you mention in your other thread, in your shoes I would definitely be taking one of these.
Even without those circs, the difference between these and the best rates on the market is pretty small, so given your small mortgage it may well not be worth the time/expense of moving provider.

jmb1

lfc321 said:

They're not market leading rates, but they're generally pretty par for the course. Given the circs you mention in your other thread, in your shoes I would definitely be taking one of these.
Even without those circs, the difference between these and the best rates on the market is pretty small, so given your small mortgage it may well not be worth the time/expense of moving provider.

Thanks, I will follow that then. I know it's hard to predict but what do you think you'd go for 2,3 or 5 yr fix?

RelievedSheff

jmb1 said:

lfc321 said:

They're not market leading rates, but they're generally pretty par for the course. Given the circs you mention in your other thread, in your shoes I would definitely be taking one of these.
Even without those circs, the difference between these and the best rates on the market is pretty small, so given your small mortgage it may well not be worth the time/expense of moving provider.

Thanks, I will follow that then. I know it's hard to predict but what do you think you'd go for 2,3 or 5 yr fix?

Given the small amount involved I would be taking the 5 year fix and overpaying it to get it repaid in the 5 years.

jmb1

RelievedSheff said:

jmb1 said:

lfc321 said:

They're not market leading rates, but they're generally pretty par for the course. Given the circs you mention in your other thread, in your shoes I would definitely be taking one of these.
Even without those circs, the difference between these and the best rates on the market is pretty small, so given your small mortgage it may well not be worth the time/expense of moving provider.

Thanks, I will follow that then. I know it's hard to predict but what do you think you'd go for 2,3 or 5 yr fix?

Given the small amount involved I would be taking the 5 year fix and overpaying it to get it repaid in the 5 years.

Thanks for the advice. We'd love to be able to make over-payments but we're hoping to possibly borrow a secondary amount for an extension over the next year or two so unlikely to be able to afford overpayments and that. (Unless for some reason this with the 5 year fix without overpayment is ill-advised?

lfc321

jmb1 said:

lfc321 said:

They're not market leading rates, but they're generally pretty par for the course. Given the circs you mention in your other thread, in your shoes I would definitely be taking one of these.
Even without those circs, the difference between these and the best rates on the market is pretty small, so given your small mortgage it may well not be worth the time/expense of moving provider.

Thanks, I will follow that then. I know it's hard to predict but what do you think you'd go for 2,3 or 5 yr fix?

No way of knowing which is best - it’s a gamble, the outcome of which will only be known when you see what interest rates are in years 3, 4 and 5. Although they have different rates, the monthly repayments on £50k are going to be very close - just a few pounds per month in it. So I would ignore that. 

In general, if this was near my limit of affordability I would be taking a longer fix to have that security. If the monthly payments were fairly comfortable, I might be more inclined to gamble on a shorter fix and see where rates are in a couple of years. 

In the end I think I would probably go for the 3 year. But not because of any special insight - just because it’s the middle one! 

Hoenir

jmb1 said:

RelievedSheff said:

jmb1 said:

lfc321 said:

They're not market leading rates, but they're generally pretty par for the course. Given the circs you mention in your other thread, in your shoes I would definitely be taking one of these.
Even without those circs, the difference between these and the best rates on the market is pretty small, so given your small mortgage it may well not be worth the time/expense of moving provider.

Thanks, I will follow that then. I know it's hard to predict but what do you think you'd go for 2,3 or 5 yr fix?

Given the small amount involved I would be taking the 5 year fix and overpaying it to get it repaid in the 5 years.

Thanks for the advice. We'd love to be able to make over-payments but we're hoping to possibly borrow a secondary amount for an extension over the next year or two so unlikely to be able to afford overpayments and that. (Unless for some reason this with the 5 year fix without overpayment is ill-advised?

The 5 year fix having a lower interest rate than the 2 year fix. Will result in a lower monthly outgoing. Simply overpaying the mortgage with the difference between the two products will make a difference. Nor would you miss the money. Every £ helps in the longer term. 

lfc321

Hoenir said:

jmb1 said:

RelievedSheff said:

jmb1 said:

lfc321 said:

They're not market leading rates, but they're generally pretty par for the course. Given the circs you mention in your other thread, in your shoes I would definitely be taking one of these.
Even without those circs, the difference between these and the best rates on the market is pretty small, so given your small mortgage it may well not be worth the time/expense of moving provider.

Thanks, I will follow that then. I know it's hard to predict but what do you think you'd go for 2,3 or 5 yr fix?

Given the small amount involved I would be taking the 5 year fix and overpaying it to get it repaid in the 5 years.

Thanks for the advice. We'd love to be able to make over-payments but we're hoping to possibly borrow a secondary amount for an extension over the next year or two so unlikely to be able to afford overpayments and that. (Unless for some reason this with the 5 year fix without overpayment is ill-advised?

The 5 year fix having a lower interest rate than the 2 year fix. Will result in a lower monthly outgoing. Simply overpaying the mortgage with the difference between the two products will make a difference. Nor would you miss the money. Every £ helps in the longer term. 

That is strictly true.  But the difference in monthly payments between the 2-year and the 5-year is only £5 per month (the 3-year is in between the two). Of course you’re right that even overpaying £5 per month would make a difference, but not an enormous one. 

Personally, I wouldn’t make this decision on the basis of the small differences in monthly payments.  I’d make it on the basis of my attitude to risk in relation to future interest rate movements: possible benefit of shorter fixed period if interest rates fall vs possible risk of shorter fix if they rise. 

jmb1

Personally, I wouldn’t make this decision on the basis of the small differences in monthly payments.  I’d make it on the basis of my attitude to risk in relation to future interest rate movements: possible benefit of shorter fixed period if interest rates fall vs possible risk of shorter fix if they rise. 

Thanks all. I am tending to agree with this, and speculate the rates will possibly come down further toward 2026-7 so was thinking of getting a revised offer based on a 2 or 3 year rather than a 5. I'll be sick as a pig if they rise dramatically in the next 5 years mind you!