Mortgage advice - FTB

triggerthat · 24 Sep 2013 at 13:48

I spoke to Halifax and they can offer me the following:

2 year fixed, 2.49%, 3.9% APR. This is based on a £210K house with a 63K deposit.

Can I do better? Any recommendations for first time buyer?

HSBC is doing 2.49%, 3.8% APR.

Adam · 24 Sep 2013 at 13:56

There are countless comparison sites where you can input those figures and they will give you a table of results.

Why don't you start there?

triggerthat · 24 Sep 2013 at 14:01

I have, but I wanted to get a human response.

Worth going fixed or tracker?

rossk26 · 24 Sep 2013 at 14:04

Equate the mortgage fees into any calculations. It can often be the case that a slightly higher %APR can work out cheaper due to cheaper if not free fees...

Kudos on saving £63k for FTB deposit too. I'm currently working my way towards a £25k deposit in 24 months (6 months in and going well so far).

platypus · 24 Sep 2013 at 14:04

We can't possibly advise you on that.

Fixed would make sense if the interest rate goes up, but since only the BOE know when they're going to do that (and they will at some point), you may get a better deal with a tracker.

I'd suggest sitting down and work out what it's going to cost you to repay if interest rates go to 1%, 3%, 5% or a ballpark high figure of say 10%.

I'm guessing this is repayment?

PiKe · 24 Sep 2013 at 14:09

I'm on 5 years fixed at 3.06%.

booyaka · 24 Sep 2013 at 14:14

what are the fee's for the deal as well? You need to factor that in as well.

TommyV · 24 Sep 2013 at 14:14

That's an awesome deposit.

Adam · 24 Sep 2013 at 14:31

triggerthat said:
I have, but I wanted to get a human response.

Worth going fixed or tracker?

With respect, sounds like you would be better to pay a mortgage broker and get their opinion/advice. You won't get the quality from here nor can anyone guess when interest rates will rise (which they undoubtedly will). It's a bit of a gamble either way.

pitchfork · 24 Sep 2013 at 14:33

rossk26 said:
Kudos on saving £63k for FTB deposit too. I'm currently working my way towards a £25k deposit in 24 months (6 months in and going well so far).

Bit assuming to say saved, could have been a gift, or inheritance or a combination of savings etc.

triggerthat · 24 Sep 2013 at 15:19

There is 0 fee on those mortgages.

PiKe, is that APR?

I briefly spoke to my adviser and she said that the tracker and fixed are currently the same %/APR.

grimm · 24 Sep 2013 at 15:27

Ignore APR, it is useless. Just go off what the deal itself says (interest rate, fees payable and number of years that the deal is for).

Oh, and talk to a mortgage adviser.

Orch · 24 Sep 2013 at 15:48

grimm said:
Ignore APR, it is useless. Just go off what the deal itself says (interest rate, fees payable and number of years that the deal is for).

Oh, and talk to a mortgage adviser.

It took a while, but we got there in the end.

^^ good advice.

Jimbo Mahoney · 24 Sep 2013 at 20:33

platypus said:
... only the BOE know when they're going to do that (and they will at some point), you may get a better deal with a tracker..

Good advice, but it's not the BoE that shapes lending rates on mortgages. It's usually the rate on 10 - 15 year gilts, which is the rate at which people are willing to lend to the government.

Best bet is to check gilt yields creeping up:

http://markets.ft.com/research/Markets/Bonds

More QE = more gilt buying = lower gilt yield = lower mortgage rates

BUT

More QE = eventually less trust in the currency = higher gilt yields = higher mortgage rates

triggerthat · 25 Sep 2013 at 08:08

Thanks for the advice. Seeing the bank in a few days.

Can brokers give you a better mortgage rate or is it just best to go to the bank directly?

ruffneck · 25 Sep 2013 at 08:33

I've just re-mortgaged my house, ended up on a 2 year fixed @ 2.45%. Its a nice feeling to knock 14 years off!

boxman2000 · 25 Sep 2013 at 08:38

Typically going direct to the lender will be cheaper as the broker has to get their cut from somewhere (i.e. you!)

Little_Crow · 25 Sep 2013 at 09:08

We used the Which? mortgage service and were very happy with them.
They are salaried and not on commission, any cut goes back to run the company - so it's as impartial as you could really get.

We could either pay them a set fee (£1000 I think), and then we would be paid what would be their cut (typically a certain percentage) when the mortgage was setup, or just let them have their cut and pay no extra up front.
It worked out better to let them just take their cut, and the guy even advised us that was the better option.

I would definitely advise using a broker, I don't know that I'd trust a banks own mortgage adviser to not be incentivised in some way to offer their own deals over another's - so you won't know if you're getting the best deal for you.
You're in a very strong position with nearly a third of the value as a deposit so you should be getting some really good deals. We had £90K deposit on a £290K mortgage and got 3.09% fixed for 5 years with Nationwide.

I personally think fixed rate is the way to go, and for as long as you can get it. Interest rates can't go any lower, so a tracker can only ever mean you pay more a month rather than less.

OpenToSuggestions · 28 Sep 2013 at 10:18

In my experience mortgage advisors are a complete waste of time and recommended a mortgage with a £500 fee, £300 fee to the advisor and a 4.5% interest rate.
I found 4.15% on my own with no fees at all.

Unless you have a special situation such as a poor credit history I would really just do your homework online.

A.N.Other · 28 Sep 2013 at 10:55

Find an advisor that gets a cut from the insurance company (so they're free to you) and see what they come up with. There are small numbers of policies that are only available through a broker. Separately find the best you can yourself through your bank / comparison sites and weigh up the two.

Our broker was very nice - no pressure. He couldn't match the price that natwest gave us separately, though, so we didn't do it through him. They're used to it.