Halifax mortgage due to end Nov 05

fitmiss123

3 year Halifax mortgage for 47k about to end. with a nice low rate of 3.99

I am considering selling next year as my 3 year ends with the council ( If I sell now I have to pay them 7k back)
Houses like mine are selling for 100k this year.
Would it be better to take an interest only mortgage for a year or see what Halifax suggests. Ideally I would like to buy another house for around 120k, which I can on my wages/tax credit of 12k if I sell my house around 100k (fingers,legs and everything crossed)
Can someone please give me some advice.

Many thanks

herbiesjp

If you carry on on a repayment basis you will reduce the amount of mortgage outstanding, whilst the property value may not increase.

By reducing the mortgage amount, even by a little means that when you come to sell, more of what you make goes into your pocket and not back to Halifax.

Whatever you decide to do make sure that the deal has no extended tie-ins, as if you want to sell in a years time you want not want to have to pay a penalty to get out.

fitmiss123

cheers for the advice, I will continue to carry on a repayment basis, But what life span shall I take of the remortgage as I want to sell in a years time?
If I take out another 3 year fixed will I be able to carry it over onto the new house I buy? Sorry I'm new to this remortgage lark

MarkyMarkD

Yes, most (but not all) lenders would let you port a new 3 year fixed mortgage to a new property. But there is a risk that the lender you choose won't want to lend you enough money to buy the new property and you may end up over a barrel (having to redeem early and pay penalties). It sounds like you want to borrow a large multiple of your income on the new property which may give you this problem.

I think, given that:

(a) a £47k mortgage is relatively small; and
(b) you might want to sell within a year

that I would opt for a no fees, no penalties, remortgage - it won't be the best rate, but it will probably give you the best overall deal considering the flexibility you want. Then you can choose to fix when you buy the new house.

payless

Do see if existing lender will also offer a no tie product, and compare rate / fees against those with moving to a new lender

fitmiss123

Thank you for the help, i'll be prepared now when I discuss with Halifax what they are going to offer me. scary stuff !!