Mortgage advice

TyronePower

Loan ammount £135,000, 20 year repayment at fixed rate of 4.24% for 26 months. then 5.4% for 214 monthly payments.
If there is 1% increase in base rate, the monthly rate will increase by £76.

It looks pretty good - but I have no idea how or what to compare this with.
Anyone got any thoughts ?

regards
Tyrone

Fairdo_2

TyronePower wrote:

Loan ammount £135,000, 20 year repayment at fixed rate of 4.24% for 26 months. then 5.4% for 214 monthly payments.
If there is 1% increase in base rate, the monthly rate will increase by £76.

It looks pretty good - but I have no idea how or what to compare this with.
Anyone got any thoughts ?

regards
Tyrone

Tyrone

It is pretty good. It's the best 2 year Fixed Rate without any Overhang of penalty at the moment. It's with Alliance & Leicester and they are currently tarred with the brush of highest Exit Fee when you come to leave them (£295 currently).

Other near contenders for similar Fixed Rates would be Halifax at 4.29% until 30-09-2007 via Intermediaries only with £599 Arrangement Fee up to 90% Loan To Value.

Nationwide, Abbey and Accord Mortgages also have reasonable comparible Fixed Rates amongst others for this period.

Some of the answer would stem from what type of rate may be most suitable for you.

If 2 year Fixed is suitable, then the A&L would be hard to beat at the moment.

KTF

Are you looking to remortgage or are you taking one out for the first time because the A&L deal has legal and other fees on top that, for example, the Nationwide 4.39% 2 year fixed deal does not charge.

TyronePower

What about capped mortgage with Leeds & Holbeck. Colleague has just informed that they do a capped rate of 5% for up to 25 years.
How does that compare and is that justified if prediction of interest rate drop again ?

TyronePower

KTF -
thanks again and something that I was totally unaware of
arrangment fee £393
valuation £310
Tele transfer £30
Sealing/final repayment fee £295

and legal fees to Solicitor of £117.50

KTF are you saying Nationwide dont have any of these fees ?

thanks
Tyrone

KTF

I have run your numbers through my spreadsheet to illustrate my point.

135000 over 20 years at 4.24% with A&L

Fee £395.00
Admin Charge £0.00
Discharge Fee £295.00
Legals £280.00 (estimated)
Valuation £280.00 (estimated)
Cashback £0.00
Total £1,250.00

Gives you £835.25 a month ex fees or 887.33 (inc fees) over the term of 24 months.

135000 over 20 years at 4.39% with Nationwide

Fee £389.00
Admin Charge £90.00
Discharge Fee £90.00
Legals £0
Valuation £0
Cashback £0.00
Total £569

Gives you £846.08 a month ex fees or 870.00 (inc fees) over the term of 24 months.

So even though the monthy payment is slightly more with the Nationwide the total you pay (including the fees) over the term will be less than the A&L deal.

Edit: If you would like a spreadsheet that allows you to comare the difference between the different deals then send me a PM with an email address and I can send it to you.

** Note I am not an expert. I am illustrating the point. I could be making it up as I go along so always consult an expert **

KTF

TyronePower wrote:

KTF -
thanks again and something that I was totally unaware of

Tyrone

The nationwide charges you the arrangement fee and an admin charge of £90. They pick up the tab for all other fees.