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  • FIRST POST
    • puddy28cat
    • By puddy28cat 15th May 18, 5:57 PM
    • 12Posts
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    puddy28cat
    Remortgage with only 2 years left
    • #1
    • 15th May 18, 5:57 PM
    Remortgage with only 2 years left 15th May 18 at 5:57 PM
    I am coming to the end of my fixed rate term with halifax and i have just 2years left on my mortgage. When i tried to remortgage today on a fixed rate for 2years i was told this was not possible. Apparently the 2 years is really 2years and 3 months and if i wanted to fix i would have to extend my mortgage to 3 years to cover their mimimum term.
    My only option if i wish to stay is to either extend my mortgage by another year, which i do not eant to do, or go variable for the last two years. Again i dont really want to do this as i like the security of fixed rate.
    Does anyone know if this is the case for all mortgage lenders?
Page 1
    • Farmerbob
    • By Farmerbob 15th May 18, 6:45 PM
    • 210 Posts
    • 127 Thanks
    Farmerbob
    • #2
    • 15th May 18, 6:45 PM
    • #2
    • 15th May 18, 6:45 PM
    I cant answer for all but I know other lenders are the same. If youre nearing the end of your mortgage you may find you are below the minimum amount to remortgage to some other lenders.
    You could consider extending the term, fix for 2 more years then overpay so it ties into the end of the fixed term within ERC limits of course but its worth look at all options open to you.
    • TrickyDicky101
    • By TrickyDicky101 15th May 18, 7:26 PM
    • 3,158 Posts
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    TrickyDicky101
    • #3
    • 15th May 18, 7:26 PM
    • #3
    • 15th May 18, 7:26 PM
    Have you actually considered the financial impact an increase in rates of say 5% over your remaining two years would have - assuming you were on a variable rate that moved in step with each increase? It's unlikely that any such increase would have a large (absolute) impact.
    • puddy28cat
    • By puddy28cat 15th May 18, 8:18 PM
    • 12 Posts
    • 2 Thanks
    puddy28cat
    • #4
    • 15th May 18, 8:18 PM
    • #4
    • 15th May 18, 8:18 PM
    Farmerbob, I like the suggestion of overpaying to tie in with the end of the fixed term.
    I know if I go variable we are not talking about much, i was just so taken aback that I couldnít just remortgage as I have done all these years.
    • dcfc67
    • By dcfc67 15th May 18, 9:05 PM
    • 51 Posts
    • 35 Thanks
    dcfc67
    • #5
    • 15th May 18, 9:05 PM
    • #5
    • 15th May 18, 9:05 PM
    i'm in a similar situation with the CO-OP bank.
    2 years 5 months left, gone onto a 2 year fix, rate is 0.75 less than rate that's just ended, they were most helpful sorted out the figures so mortgage runs for 2 years.
    Works out payments are approx. £2 more than what i used to pay last month and i finish my mortgage 6 months earlier.

    Can you suggest this
    • getmore4less
    • By getmore4less 16th May 18, 6:15 AM
    • 33,246 Posts
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    getmore4less
    • #6
    • 16th May 18, 6:15 AM
    • #6
    • 16th May 18, 6:15 AM
    How much do you owe?
    what is your current payment?
    what is the follow on rate?
    what is the rate on offer if you extend to three years?
    • puddy28cat
    • By puddy28cat 16th May 18, 8:51 AM
    • 12 Posts
    • 2 Thanks
    puddy28cat
    • #7
    • 16th May 18, 8:51 AM
    • #7
    • 16th May 18, 8:51 AM
    I owe £10650 on a current rate of 3.09%. To go variable will be 3.99%. To fix over 3 years would be 2.74%.
    • kingstreet
    • By kingstreet 16th May 18, 10:29 AM
    • 34,220 Posts
    • 18,574 Thanks
    kingstreet
    • #8
    • 16th May 18, 10:29 AM
    • #8
    • 16th May 18, 10:29 AM
    Some lenders have products for x years from completion, others have products which run until dd/mm/yyyy.

    If you can't do another Halifax product transfer, look for a lender offering the former and see if you can remortgage.
    I am a mortgage broker. You should note that this site doesn't check my status as a Mortgage Adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice. Please do not send PMs asking for one-to-one-advice, or representation.
    • owen_money
    • By owen_money 16th May 18, 10:59 AM
    • 560 Posts
    • 642 Thanks
    owen_money
    • #9
    • 16th May 18, 10:59 AM
    • #9
    • 16th May 18, 10:59 AM
    I'd move onto the SVR.
    If you fixed @ 3.09% you'd pay £346 in interest over 2 years. Moving onto the SVR @ 3.99% you'll pay £462 -£116 more. Even if it went to 6% today you'd only pay £472 total interest in the two years

    The benefit would be you could make unlimited amounts in over payments without any ERC.

    If you made a £200 a month over payment you'd pay the mortgage off in 17 months and save £137 in interest

    *All figures are approximate
    One man's folly is another man's wife. Helen Roland (1876 - 1950)
    • puddy28cat
    • By puddy28cat 16th May 18, 8:09 PM
    • 12 Posts
    • 2 Thanks
    puddy28cat
    Thank you for all your replies. I really appreciate the figures provided by owen_money as it has put all the costs into perspective.
    I think I!!!8217;ll stick with the SVR and do my best to overpay as and when I can.
    • getmore4less
    • By getmore4less 17th May 18, 6:57 AM
    • 33,246 Posts
    • 20,072 Thanks
    getmore4less
    as Owen shows the numbers are not that big or different due to the small amount and short term

    I owe £10650 on a current rate of 3.09%. To go variable will be 3.99%. To fix over 3 years would be 2.74%.
    Originally posted by puddy28cat
    Shame you are with the Halifax they are rubbish for the smaller mortgages < £100k but probably not worth changing unless you can get a completely free switch.

    looking in more detail

    To pay this off over 2 years payment and interest paid.

    £10,650 @ 3.99% £462.43 £448.27
    £10,650 @ 3.09% £458.17 £346.18
    £10,650 @ 2.74% £456.53 £306.63

    over payment limits restrict paying the fix over the 2years

    The 2y fix over 3 but paying off in 2
    £10,650 @ 2.74% £308.50 £455.86

    With 10% overpayments(annual 1st jan) best you can squeeze that

    now(june)till jan is 7 months £1,065/7= 152.14)
    £10,650 @ 2.74% £460 £225.65 (left with £5,355.65 new payment £190 over 29 months)

    the next year max overpayment £44
    £5,355.65 @ 2.74 £234 £112.52 (left with £2,640 new payment £158 over 17 months)

    with 5 months of the 2y fix left max overpayment £22

    £2,640 @ 2.74% £180 £26.66 left with £1,877(should be able to have that saved)

    total interest £365


    If you stick with the variable £3.99 with £462 payment and get a zero% spending credit card with a long period(2y min) you could throw all your normal spending on the card and overpay the mortgage
    if with normal mortgage payment and spending money you will save on interest

    examples total payment interest time to pay off
    £10,650 @ 3.99% £600 £346 19m
    £10,650 @ 3.99% £800 £262 14m
    £10,650 @ 3.99% £1000 £212 11m
    £10,650 @ 3.99% £1200 £179 10m

    once the mortgage is paid you have time to pay down the credit card(its the same money you would have used on the mortgage).

    If you have any planned bigger spends like a holiday this could save even more.

    If you have spare cash flow or can create it the variable rate will give the better option to save on interest
    • dcfc67
    • By dcfc67 17th May 18, 4:50 PM
    • 51 Posts
    • 35 Thanks
    dcfc67
    What about taking out a personal loan to clear the mortgage

    Sainsburys Bank £10000 over 24 months is £428 a month
    • getmore4less
    • By getmore4less 17th May 18, 6:11 PM
    • 33,246 Posts
    • 20,072 Thanks
    getmore4less
    What about taking out a personal loan to clear the mortgage

    Sainsburys Bank £10000 over 24 months is £428 a month
    Originally posted by dcfc67
    If they can get 2.59%
    • puddy28cat
    • By puddy28cat 14th Jul 18, 11:14 AM
    • 12 Posts
    • 2 Thanks
    puddy28cat
    I was unable to get a personal loan to repay me mortgage as apparently this is not allowed! Therefore I decided to stay where I was.
    I received my new monthly payment letter the other day to say my payments where going from £480 per month to £505 per month.
    Now as the internet rate is only changing from 3.09% to 3.99% I cannot see how this can possibly be correct. I phoned the Halifax today and they insist this is correct. This is dispite the fact I have it in writing when I took out this mortgage in 2014 that my payments would increase to just £485.
    I have asked for a breakdown of their calculations.
    My question is, I can afford to pay the higher amount and if I do so, at the end of the mortgage will I have been robbed by the Halifax by over £500 or will I actually find it all works out in the end and my mortgage will be finished sooner?
    • robatwork
    • By robatwork 14th Jul 18, 2:22 PM
    • 4,590 Posts
    • 5,166 Thanks
    robatwork
    It has been mentioned on here before that the bank giving the loan doesn't care what you do with it once they have paid it into your account. For example you may want it for house improvements, but suddenly get an illness that you elect to pay for and get specialised surgery abroad out of that money. Nobody would care.

    Of course I am not for one minute suggesting you tell the bank you are taking the loan for anything other than the true reason.
    • middleclassbutpoor
    • By middleclassbutpoor 14th Jul 18, 2:52 PM
    • 286 Posts
    • 249 Thanks
    middleclassbutpoor
    It has been mentioned on here before that the bank giving the loan doesn't care what you do with it once they have paid it into your account. For example you may want it for house improvements, but suddenly get an illness that you elect to pay for and get specialised surgery abroad out of that money. Nobody would care.

    Of course I am not for one minute suggesting you tell the bank you are taking the loan for anything other than the true reason.
    Originally posted by robatwork
    What are you suggesting then?
    • enthusiasticsaver
    • By enthusiasticsaver 14th Jul 18, 6:05 PM
    • 7,177 Posts
    • 15,595 Thanks
    enthusiasticsaver
    On a small mortgage as you are nearing the end I would stick with SVR and overpay to get rid of it asap.
    Debt free and mortgage free and early retiree. Living the dream

    I'm a Board Guide on the Debt-Free Wannabe, Mortgages and Endowments, Banking and Budgeting boards. I volunteer to help get your forum questions answered and keep the forum running smoothly. Any views are mine and not the official line of moneysavingexpert.com. Pease remember, board guides don't read every post. If you spot an illegal or inappropriate post then please report it to forumteam@moneysavingexpert.com
    • getmore4less
    • By getmore4less 15th Jul 18, 7:11 AM
    • 33,246 Posts
    • 20,072 Thanks
    getmore4less
    I was unable to get a personal loan to repay me mortgage as apparently this is not allowed! Therefore I decided to stay where I was.
    I received my new monthly payment letter the other day to say my payments where going from £480 per month to £505 per month.
    Now as the internet rate is only changing from 3.09% to 3.99% I cannot see how this can possibly be correct. I phoned the Halifax today and they insist this is correct. This is dispite the fact I have it in writing when I took out this mortgage in 2014 that my payments would increase to just £485.
    I have asked for a breakdown of their calculations.
    My question is, I can afford to pay the higher amount and if I do so, at the end of the mortgage will I have been robbed by the Halifax by over £500 or will I actually find it all works out in the end and my mortgage will be finished sooner?
    Originally posted by puddy28cat
    What balance & payments to the £ along with terms to the month were on the previous and this schedule


    if you were paying £480 on 3.09% and it is now £505 that would be around a £58k mortgage over 12years which we know it is not.


    if you were paying £480 on £10650 @ 3.09% in May
    that was around 1 year 11 months full term

    did you round to £480? 1y 11m is £477.50

    at 3.99% that would have been £481.75

    2 months later would have a balance of around £9750

    over 1y 9m 3.09% £477.50, 3.99% £481.50

    over 1y 8m 3.09% £500.79, 3.99% £504.70


    I suspect they have lost a month off the term to get the £505 figure
    • robatwork
    • By robatwork 15th Jul 18, 1:25 PM
    • 4,590 Posts
    • 5,166 Thanks
    robatwork
    What are you suggesting then?
    Originally posted by middleclassbutpoor
    I'm suggesting I don't get banned!
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