I am confused, which mortgage?

AndyH1976

Two year 4.75% fixed deal ends in July so I need a new mortgage but cant decide what to go for.

House Value = £495K
Mortgage = £318K
Savings = £24K

I have recently become a partner in the company where I have worked for 9yrs so I can prove my income. As a result I wont pay tax until January and then twice a year as normal.

My usual FA has suggested an offset with the Woolwich and another has suggested an interest only short term fixed deal but to make over payments. Ether way I know my repayments are going to go up a huge amount. I also realise that as far as savings go it isnt a huge amount for an offset but a fair amount of money will be going through the current account due to a lack of PAYE.

Any advice?

curlyboy

u got to much money for a start what are u worried about

_Andy_

curlyboy wrote: »

u got to much money for a start what are u worried about

How very constructive of you.

whu

Hi
What rates/terms are being offered for each type of mortgage?The reason i ask is that even if the offset is a higher rate it might still be worth doing depending how much you can offset (which from what you say will be increased quite a lot over time) and also if the higher rate is not that much more but for a longer period you might think that is preferable rather than looking for a new mortgage in say 2/3 years.
Also depending on how much you think you will be able to overpay over time you should check what the max contributions on the non offset mortgage are as quite often it is limited to 10% a year on the outstanding amount at the time.

AndyH1976

curlyboy wrote: »

u got to much money for a start what are u worried about

Thats my tax money, it all goes to the taxman in Jan

I have just been offered 5.69%, 3yr fixed from the Abbey who is my current lender. They have an offset but its at 6.5%. Although the 5.69% would mean £200 or so more a month its much better than two FA have found.

My head is telling me to stick with the Abbey.

Spangled

Egg do a BR +0.75% tracker mortage with offset facility:

http://new.egg.com/visitor/0,,3_104914--View_2213,00.html

Worth considering if you don't think interest rates will spike any time soon. Much better than the Abbey offset you quote and (currently) only marginally off their three-year tracker.

Plus only a £70 release fee to leave the mortgage and no ERCs either.

[I'm just an interested reader - no affiliation to Egg!]

AndyH1976

Yes I saw that but they wont let me borrow that amount.

Woodgnome_2

Open an account with First Direct to be eligible for the following.

5.39% fixed for 5 years offset mortgage or 5.49 fixed for 10 years. or -

0.34% over the base rate life tracker mortgage on loans over £200,000

PhilDS

Woodgnome wrote: »

Open an account with First Direct to be eligible for the following.

5.39% fixed for 5 years offset mortgage or 5.49 fixed for 10 years. or -

0.34% over the base rate life tracker mortgage on loans over £200,000

Can you really do this? Open an account and then be considered an "existing customer"? Seems like a good loop hole if you can.

AndyH1976

Yes you can, I have just asked them. However, I think it would take too long to set up the account and then the mortgage.

PhilDS

AndyH1976 wrote: »

Yes you can, I have just asked them. However, I think it would take too long to set up the account and then the mortgage.

Wow. So, those rates aren't really closed to new customers, it just means you'll have to wait longer for it :rolleyes: Thanks again BBC for some more non-sensationalist reporting.

My renewal is due in October so this could well be worth looking at. Thanks all.