Good deal or not?

Rockydennis_2

Your thoughts would be most welcome.

Tomorrow I will be arranging re-mortgage with Britannia (also current lender).

House valuation last year 220,000.

Current rate 4.64% 2yr fix. Outstanding mortgage = 111,625.

Will be re-mortgaging for 119,625 at 6.24% 5 yr fix, which will include consolidation of loan. I am married with a 3yr old and 3 month old.

Loan amount 12,491 but will also be using savings of 5000.

New deal as above 6.24%, no valuation fee and no solicitor fee. Arrangement fee is 499 but added to loan.

This will give me repayments of 852 pcm. This leaves me 220 better off a month. I realise it isn't a good move to consolidate unsecured debt to secured debt but I think this is the best option for me.

Any better deals out there? Is it worth the added work of changing lender for a slightly lower rate?

Thanks in advance for your thoughts!

allan673

look at first directs 10 year fix @ 5.99%

booking fee £299 to be paid
arrangement fee £299 can be added to the loan
£99 valuation to be paid
no solicitors fees

probably worth remortgaging !
use a mortgage calculator to compare the difference
http://new.egg.com/visitor/0,2388,3_54988--View_1028,00.html

id have done it for you but you dont say how many years you want it over, looks like its over 21 years with you saying £852 per month.
first direct 5.99% over 21 years is around £835.31, £17 per month cheaper than your quote.
£17 x 60 months = £1020.00, or double it if you fix for 10 years.

i would fix for 10 years personally @ 5.99%, very easy to re-mortgage with first direct too, ring them for a quote.

Rockydennis_2

Thanks for the reply. The term is 21 years. I am reducing it by 8 months just to round it down. Is the first direct the account where you need to have savings?

My reasons for staying put with Britannia are because 'we know each other' and it seems much less hassle than moving.

allan673

no you dont need savings,
its a fixed rate of 5.99% - with an offset feature.
basically you can offset savings against the mortgage if you want to.

but i havent, ive opted for capital and interest style repayment, so it works exactly like a traditional repayment mortgage.
this thread may interest you? its very long though, we used to put updates on it etc for timescales.
http://forums.moneysavingexpert.com/showthread.html?t=738625
its all online and great to see the mortgage reducing each month, plus when i make an overpayment its deducted instantly from the mortgage balance.

lisyloo

Is the first direct the account where you need to have savings?

You don't need to have savings but it can make sense to put savings there (after cash ISAs) because you get 5.99% tax free.
The 1st account is where your mortgage payments are taken from.
You don't need to transfer banking to them but if you do then you can obviously offset.

allan673

Rockydennis wrote: »

Thanks for the reply. The term is 21 years. I am reducing it by 8 months just to round it down. Is the first direct the account where you need to have savings?

My reasons for staying put with Britannia are because 'we know each other' and it seems much less hassle than moving.

it really is easy to re-mortgage, and no hassle at all, its all about saving cash.
what did you decide on in the end?

Rockydennis_2

I completed telephone application with Britannia first thing this morning. Fixing for 5 years at 6.24%. Wife and I more comfortable fixing for 5 years as opposed to 10 years. I think it is a good deal for us, maybe not the best though.

Thank you for your advice though, it was appreciated.