2 year or 5 year fixed
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Halifax is proposed new lender.
halifax don't have good rates on this size of mortgage
I do think affordability is an issue as asked first direct before and they said no.
really you said earlier you were paying over £1k total pm
I have asked current provider and they can do £102k over 21 years to pass affordability test, waiting a call back next week to discuss rates.I am currently paying £545 mortgage 3.89% (think) but have £20000 CC debts which all on 0% but paying around £600 a month on those.
which lender?
And yes, the £102k is debt. £80k mortgage and £22k CC (approx. figures)
What's your current term on the £80k,
£80k 3.89% paying £545 is 200 months <17 years.
What rate will the current lender give on that with <60%LTV
is the £1,145pm sustainable.
when do your 0% run out (a list if more than 1)0 -
getmore4less wrote: »What's your current term on the £80k,
£80k 3.89% paying £545 is 200 months <17 years.
What rate will the current lender give on that with <60%LTV
is the £1,145pm sustainable.
when do your 0% run out (a list if more than 1)
Currently have 16 years and 3 months left with Bank of Ireland.
I currently pay £545 a month on my mortgage and then around £600 a month to credit cards. I then find myself tight at the end of the month and sometimes put more on the CC which is dangerous.
My wife only works part time so joint income is around £33k.
My thought is pay back £550 a month on new rates and clear debt and cut up CC's. I will have to extend my term which I know isn't ideal but for me at this time I just feel best for me and my situation.
I do appreciate the feedback though.0 -
Is the mortgage provider seeing a mortgage of £102k plus £20k of cc debt? They will see it as having no guarantee that the extra mortgage will pay off the debt so you are actually looking at in their eyes a total debt of £122k against a property value of £140k.
If you do actually pay off the credit card debt then you should be able to overpay the mortgage by some of the cc current repayments which will reduce the cost (and maybe the length) of your next fix.0 -
Is the mortgage provider seeing a mortgage of £102k plus £20k of cc debt? They will see it as having no guarantee that the extra mortgage will pay off the debt so you are actually looking at in their eyes a total debt of £122k against a property value of £140k.
No, just £102k, so in theory I could spend other £20k on rubbish but trust me that is not going to happen. Got myself in a mess and learnt mistake.0 -
looking at the web site
BOI rates
<60% LTV 2.09% product switch no fee
<75% LTV 2.29% further borrowing no fee.
Using those rates 0.2% on £80k is £160py and 2.29% on £22k is £500py consolodating will costs an extra £55pm to start with)
Consolidation has issues of its own if you can't control the spending
there is a mid ground where you consolidate some clear the rest before the 0% runs out and overpay to bring the term back down.
For now I think you need to focus on getting better rates than your broker is finding.0 -
getmore4less wrote: »looking at the web site
BOI rates
<60% LTV 2.09% product switch no fee
<75% LTV 2.29% further borrowing no fee.
Using those rates 0.2% on £80k is £160py and 2.29% on £22k is £500py consolodating will costs an extra £55pm to start with)
Consolidation has issues of its own if you can't control the spending
there is a mid ground where you consolidate some clear the rest before the 0% runs out and overpay to bring the term back down.
For now I think you need to focus on getting better rates than your broker is finding.
I today spoke to BOI. For the amount I want to borrow they would only do it over 27 years. However they can offer me 2 year fixed @ 2.09% on outstanding mortgage and 2.29% on extra loan, total monthly payments would be £412. 5 year fixed would be 2.79% and 2.90% meaning £447 per month.
Big decision is do I want it over 27 years? My broker was about £550 per month over 20 years. I suppose I could go with 27 years and overpay least £100 per month and this would bring term down?
What are your (or anyone else) thoughts? Thanks.0 -
True term is decided by how much you pay.0
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There's no problem taking it over 27 years instead of 20 but paying as much each month as if you'd done it over 20 ; and then it will be paid off in 20. As long as the overpayments aren't big enough to go over whatever overpayment allowance you have before attracting an early repayment charge. Nationwide maximum penalty-free overpayment for example is 10% of original balance, per year, which is much more than the overpayments you'd need to pay to knock a 27 year term down to 20.
As for 2 yr vs 5 year fix, this is a trade off between assessing your view of:
- the extra money you will pay on a 5 on the first 2 years
- the extra money you will pay or the money you will save in the last 3 of the 5 years with your known agreed rate on the 5 year product vs the rate you can get from a new product on the market two years from now; the rate in 2019 might be great if base rates are low and you have been eating away at your LTV, or the rate in 2019 might be terrible because house prices crashed and you're over 90% LTV and happen to be going through a period of unemployment.
- the market conditions you would face on refinancing for a longer term in 2022 when the 5 expires vs the market conditions you'd face on refinancing for a longer term in 2019 when the 2 expires; e.g. it might be that rates are going to stay low until 2019,2020 and then start to go up a lot, meaning if you took the 2yr product you could lock in for a long fix as a 'last chance' for low rates in 2019, while if you took the 5 year product you would have well and truly missed the boat on getting a last oppportunity for super-low rates before they are gone for a generation.
Personally I went for 5 yr fix on my 75% LTV purchase due to the stability; not wanting to take the risk of having to refinance in two years time. The rate differential between the 2 and 5 year products didn't add up to an excessive amount of money per month to 'buy' that security.0
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