neo

Here' my dilema

1, I want to convert from endowment to repayment morgage any ideas which is the best repayment option, fixed for 2 yrs at 5.29%, or 1.4% dicounted from base rate for 2 yrs, or any other type of deal.

the old endowment will be redundant as far as the morgage is concerned if i go the repayment option, so i was going to keep it up as a savings plan, but is it better to surrender it and (A)transfer funds to a more adapt policy for saving,(B)surrender and take of its value from repayment morgage balance,and start a new seperate savings plan for the same ammount of money a month as the endowment was, its all too confusing for me any ideas would be greatful.

the endowment is 9 yrs old and has 16yrs to run and if it hits all its targets etc will mature to 45k which i doubt it will so any advice would be helpful cheers neo

stevem2k

I'm looking to do almost the same thing, but with surrender values of endowments being pants and sale values not much better, I am going to hold onto it as a long term investment, and just pay off the mortgage.

Running some numbers yesterday I can switch to repayment over the same period (21years now) for 60 quid a month more. Adding a few extra quid to that will pay it all off 6 years early ( saving 19 grand).

Discount or fixed is a tough call. You are essentially betting on this bunch of wasters in government convincing us to join the euro ( discount ) or not ( fixed ) within the life of the product.

As always watch out for lock in periods, charges that may crawl out of the woodwork if you decide to move and whether the interest is calculated daily, monthly or annually.

Cheers
Steve

DAC

neo - just doing same myself as I am moving.

talk to Yorkshire building society, Or Halifax
ref Tracker mortgages.
they follow the Bank of England base rate, currently at 4.00% I think.

current deal is about 4.25% for two years with the Halifax and no penalty times after that.

looks to be deals at the moment.

blair

If you are considering surrendering the endowment also look at selling the policy to a second hand endowment broker. They will often offer you more than you would get from your insurance company for the policy.

For mortgages - as has been said you need to guess what is going to happen to interest rates in the future. I've got a 5yr 1.5% discounted policy with abbey national at the moment - it's cheap but they only let me pay 10% of the outstanding capital off each year so its not great if you are aiming to pay off your mortgage early.