sandwichsaint Posted 23 February, 2013 Share Posted 23 February, 2013 I think I've seen this before, any mortgage brokers on here or anybody else in that line of work? Currently tied into a pretty poor deal with my current lot (4.49% fixed for another 18 months) and I would like to pay them up and start again at a better rate and with higher repayments. Currently paying 905 month, we owe 32,800 plus a buy-out fee of 1,310 so need 34k to pay them up. They have offered a lifetime tracker at 3.79, that would take 38 months x £975, or 30 months x £1220. Trying to look around on the interweb at alternatives but most calculators won't go below 5 years repayments. Presumably it is possible to get shorter terms than 60 months (?). Ideally I would like to get the payments down to 24 months at c1500, I could afford this. Would an offset mortgage be any help in this situation? Could prob get my hands on 15k cash to off-set but would have to take it out of ISAs to do that .... would that be cost effective? (Could put the 15k off the mortgage, pay the remainder off in 12 months, and then run without any savings/reserves for 12 months but not keen on that) On a tangent I could get a 5 yr fix that gives 60 payments of 629, half-tempted by this approach but Mrs S wants it out the way asap , thoughts? Link to comment Share on other sites More sharing options...
St Jim Posted 23 February, 2013 Share Posted 23 February, 2013 (edited) I think I've seen this before, any mortgage brokers on here or anybody else in that line of work? Currently tied into a pretty poor deal with my current lot (4.49% fixed for another 18 months) and I would like to pay them up and start again at a better rate and with higher repayments. Currently paying 905 month, we owe 32,800 plus a buy-out fee of 1,310 so need 34k to pay them up. They have offered a lifetime tracker at 3.79, that would take 38 months x £975, or 30 months x £1220. Trying to look around on the interweb at alternatives but most calculators won't go below 5 years repayments. Presumably it is possible to get shorter terms than 60 months (?). Ideally I would like to get the payments down to 24 months at c1500, I could afford this. Would an offset mortgage be any help in this situation? Could prob get my hands on 15k cash to off-set but would have to take it out of ISAs to do that .... would that be cost effective? (Could put the 15k off the mortgage, pay the remainder off in 12 months, and then run without any savings/reserves for 12 months but not keen on that) On a tangent I could get a 5 yr fix that gives 60 payments of 629, half-tempted by this approach but Mrs S wants it out the way asap , thoughts? Being in the banking industry I have to be very careful on giving advice and am unable to offer any advice as to what you should or shouldn't do but will make the following points (apologies if this is all known to you anyway - I don't know what your knowledge of banking products is like): Offset - consider the materiality of the interest saving benifits of this, particularly if you are only looking for a sort term mortgage. Also consider the difference in interest benifit between the ISA and the offaet account. Fixed - be aware that overpaying a fixed rate loan often leads to penalty fees (this is because there is a potential real or economic cost to the bank whne people overpay). You will need to check this with the institution offering the product. Tracker - there should not be fees for overpaying (I say 'should not' but you will need to check this with the bank/broker) but could be a risk if the UK economy improves drastically and the cash rate moves up. Ultimately you will need to do the sums youself (or speak with a bank for assistance if requried) to work out the total amount you will be paying against the different products available to you then weigh up the pro's and con's of the costs, risks and different term lengths taking into account your personal situation. Edited 23 February, 2013 by St Jim Link to comment Share on other sites More sharing options...
cryoman1965 Posted 23 February, 2013 Share Posted 23 February, 2013 I don, t work in mortgages but have been looking at clearing mine also. Does your current mortgage allow any over payment. A lot do 10% pa. you Currently pay 905 your can pay 1500 giving an excess of £10710 over the 18 mths to save or pay of if allowed. 905 over 18mths 16290 + 10710 = £27000. Including interest you will owe 8k tops after 18 mths. Achieving 24 mths without giving away £1310 buyout currently possible but working out the cheapest without a real time calculator is the challenge. I would think staying where you are is a good option and I would say that the buyout will make the other option dearer. Nastiest do a 2 yr fixed 3.19% with mthly payments of £1395.32 over 24 mths. It will be very simular over the two options. Disclaimer I know nothing about money mortgages Apr interest rates % $ £ . Hth Link to comment Share on other sites More sharing options...
View From The Top Posted 23 February, 2013 Share Posted 23 February, 2013 Odd as my Doris & I have just been (literally just been) looking into switching ours as our deal isn't as sweet as we'd like and are already overpaying significantly to clear it early. I suppose folks annual statements have been hitting the doormats. Link to comment Share on other sites More sharing options...
Monkeyboy Posted 25 February, 2013 Share Posted 25 February, 2013 Would really recommend Louise or Tim from http://www.harrisongray.co.uk/ have been given some advice from them in the past and am now on a much better rate. They've also set up a mate of mine with his first mortgage Link to comment Share on other sites More sharing options...
tony13579 Posted 25 February, 2013 Share Posted 25 February, 2013 The best thing I did was to get an interest only flexible tracker mortgage running till I am 65. It does require self discipline. We have heavily used tax efficient share save schemes at work rather than paying off the capital on the mortgage. We managed to pay off £52k in 3 years from £18k of savings I can also draw down money to extend or even buy another house with only a £50 admin fee. I can draw down the original mortgage of £142k even though we no longer have the 2 wages that supported that. Our current mortgage interest is £9 per month Fees are the killer at the moment. A lot of the short 2/3 year deals at 2% work out at 4% if you add in the booking fee. It's a card trick! Link to comment Share on other sites More sharing options...
tony13579 Posted 25 February, 2013 Share Posted 25 February, 2013 https://mortgages.hsbc.co.uk/product/A001003405001003407001003409-lifetime-tracker-special?mortgages=aggregators I am not sure if you can draw back over payment but is a usefull product if you fit the rules Link to comment Share on other sites More sharing options...
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