vallumlj

We are coming to the end of our current mortgage deal we were on a fixed rate with direct line for 2 years.

When we took out the mortgage we borrowed 90% on interest only and have been saving some money in a savings account so we are now looking to go onto a repayment mortgage.

I am looking for some advice on what would be our best options. The interest rates are very low at the moment so a variable mortgage could be a good idea or I personnally think it might worth getting a fixed rate for 5 years as the interest rates have got to go up soon.

I would say our house has gone in valve as we got a got a good deal when we bought so I think we would be looking at about a 85% mortgage.

I read some information on money saving expert and Martin Lewis reckons I should first contact direct line and see what the best deal they can offer me. Then I should contact a mortgage broker to see if they can beat it.

If we stayed with Direct line would we have to pay the fees again to take out a new mortgage.

Any advice would be great.

Thanks

cookstar

iTrader: (6)

I renewed one of my mortgages a few months ago, (Alliance and Leicester), they offered a better rate, fixed for three years and zero fees, well worth a phone call.

Coffin Dodger

Unfortunately you'll only get something at a decent rate if you have at least 75% LTV. Up until recently there weren't many places offering new mortgages with an LTV higher than that but there do seem to be a few 85% ones around now. The days of 95% LTV mortgages seem to be pretty much over.

Must be one of the few houses in the contry that has increased significantly in value over the last two years We bought ours just over two years ago, got a good deal as it needed work, but I'd say we've only been able to maintain its value by doing work on it. Would probably only get what we payed (at a push) if we sold now

Definitely talk to your existing provider first to see what sort of deal you can get. Have you got an independent financial advisor you can talk to? They can often look into several possibilites for you and give you illustrations of what you'll pay, if you can afford it, etc. They usually provide their advice free of charge on the assumption that you'll take the mortgae through them. At that stage they'll get a commision payment from whoevers mortgage you got through them.

madscoob

iTrader: (3)

if you bank with nat west get in there quick they are doing some great deals for current account customers . i have just done ours on a 1.89% above boe rate for 2 years after 3 months i can switch to a better deal for prefered customers . imho variable rate deals are a licence to print money as all the banks agree what to charge ie a std vari rate at the moment is at leasr 4.5-5.5% compare that with 1.89% plus 0.5% = 2.39% i know what i would rarther pay oh and the fees where £30.00 tranfer of money fee not £999 . the £999 deal was a better rate for 3 years but only saved 400quid no one spends £999 to save 400

vallumlj

I have got a fa I can talk to.

Any other comments. Is a fixed mortgage better for us would you say?

Terminator X

iTrader: (7)

The fixed rates are all close to 5% though aren't they? Doesn't seem good VFM to me compared to variables at 2-3%. You never know when the BoE rate will go up though which will kick the variable raters hard when it happens ... should stay low for some time yet IMHO albeit not 5yrs!

TX.

Fantom

I'd stick with a tracker if I was you. The rate should stay low for at least a couple of years but I'm only guessing.
I went with HSBC and am really pleased. I have 75% LTV though so got 1.49% above the base rate.
I would definitely check out the HSBC deals as I found them to be much better than I could find elsewhere.

john banks

LTV based choices will depend on the lender's surveyor/valuation, bit chicken and egg perhaps since you don't know what that is yet, but don't know if you want to/can move lenders if the LTV is high.

EddScott

Do you know what rate your existing mortgage will revert to after the end of the special term?

I ask because I was worried a couple of years ago because our special deal was ending and the rates were going up all the time. After the deal it became a 0.49% above base tracker for life. Result!

IMO, don't fix longer than 2 or 3 years and be careful of the trackers - 2% (or whatever) above base sound good now but if interest rates move rapidly you'll be lumbered. Also, at 85% you won't get the best rates.

For 95s it mostly only existing account holders that banks will even look at.

vallumlj

Our current rate is 6.39 and the varible rate is 5.89 i think this will make the mortgage roughly £100 cheaper a month.

We are going to call them tomorrow to see what they can offer us.

What would happen if we went on the variable rate and the interest rates starting going up could we quickly fix.

Thanks for the advice