Is this a good remortgage offer?

ssue

Hiya

Advice / thoughts needed please.....

My current mortgage with Abbey ends in July and I don't want to go onto the SVR. They have offered me a new deal at 5.89% fixed for 3 years with £724 booking fee. Does this sound good? I am paying interest only as can't afford repayment at the moment.

I phoned Abbey 2 weeks ago and they offered me 3 years fixed 5.49% with £499 fee - stupidly, I didn't take this at the time as I thought that the % may come down :mad: instead it has gone up and I am now worried that if I don't take the 5.89% it will go up further.

I can't change to another company as I have just been laid off work :mad:

It also makes me mad that they are offering new customers 5.41% :mad: :mad: :mad:

UK007BullDog

Tough luck!

Are there no "no fee" products?
How big is your mortgage?

What about staying on their SVR for a few months until you have work again? Then shop around?

allan673

not a very competitive offer at all.
i wouldnt know what to suggest with you being off work?
as previous poster says what about staying on svr for a few months, ring abbey for a quote so you can compare the rates.

ssue

Abbeys SVR is over 7% - no way could I even contemplate paying that! Having not been unemployed before I'm not sure how the DHS pay your mortgage - I have read on another thread that they pay 1.58% (?) above the BOE rate towards the interest.

Abbey say this is their best deal and they have no fee-free offers.

If I don't fix now I am so worried that interest rates by lenders will be beyond my reach altogether.

My mortgage is for £126,000. I have resigned myself to the fact that I am going to have to take a considerable pay drop to get back into work and that no other lender will even consider me for a mortgage above about £90k.

nrsql

Have a look at
http://www.firstdirect.com/mortgages/rates.shtml

5 year fixed rate offset 5.39% £800 fees (half booking, half arrangement).
And that's for a fixed rate offset - the Abbey deal doesn't look good.
With this you could keep any extra money in the offset account and reduce the interest payments.

Not suggesting you go for this (even if you meet the criteria) but it puts your current offer in perspective.

Missed the bit about not being able to change company.
So your only options seem to be - go for the fixed rate or variable rate in the hope they come down later.

Odd - on their site the offers for existing mortgages for people who are moving house seem a lot better than you have been offered - wonder what the difference is? Maybe becaquse they get more fees for moving house.

Tiddler_2

It's all well and good people throwing deals that other companies are offering but in your current circumstances, no-one else will give you a mortgage.

So you have 2 options - wait to see what changes in your circumstances happen between now and 1st August, or take a deal now.

In your circumstances I would take a deal now - you've already missed out on a better rate, and despite the Government's offer to the banks to try and get more money into the mortgage market, rates don't appear to be dropping.

It's not a great deal if you have the whole market to shop from, unfortunately at the moment you don't, so it's about what's the best you can get from Abbey.

ssue

Should I fix now or wait until the end of June and then see what Abbey can offer..? Will lending rates be better in 8 weeks or worse? That is my dilema

lisyloo

Hi Ssue,

Bear in mind that a remortgage can take up to 3 months or sometimes even longer if the lender is exceptionally busy.
Right now they are pretty busy.

dimbo61

any deal below 6 % is historically very good so get yourself fixed with abbey
as you have little choice.
Once you have got back into employment then overpay and save into ISA,s
I remember having a mortgage with an interest rate of 15.4 % if only
for a short time. you are not sub prime so bite there hand off
once back on your feet get rid of the mortgage ASAP good luck