mortgage question?

helpimcrap

helpimcrap

helpimcrap

Soldato
Joined
13 Jan 2004
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12,773
Location
Leicestershire
Hi, I've never had to deal with renewing a mortgage but i like to keep it fixed rate so i can plan better and not get myself into a mess as i live on my own.

Basically my fixed rate with Santander has comes to an end in August and they've offered me 3.99% fixed rate for 2 years.

s this any good?

I had a mortgage broker around the other day to sell me a mortgage but that would mean paying fees which is they equate to more than the extra for those 2 years i'm notgoing to bother with.

Is this the right way of thinking?
 
About £71k I owe.

LTV I'll have to research on what that is lol. - loan to value of property so that would be £71k owed v £110k value of property?

Never dealt with mortgages before.
 
Ok, 71K is part of the LTV calculation - the other part is the value of the house.

I deal with mortgages every day at work... :)

LTV means Loan To Value. It's a vital calculation to determine what interest rates you can get. For example if you owe 71K against a 100K house then your LTV is 71%.

Generally below 60% LTV and you can choose any rate. The good rates are all under 70%. You pay a little bit extra at 75 or 80, and a hell of a lot more above that.
 
The Halk said:
Ok, 71K is part of the LTV calculation - the other part is the value of the house.

I deal with mortgages every day at work... :)

LTV means Loan To Value. It's a vital calculation to determine what interest rates you can get. For example if you owe 71K against a 100K house then your LTV is 71%.

Generally below 60% LTV and you can choose any rate. The good rates are all under 70%. You pay a little bit extra at 75 or 80, and a hell of a lot more above that.
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loan to value of property so that would be £71k owed v £110k value of property?

So under 70%?
 
Yes indeed it would. That gives you a wide choice of rates.

3.99% for 2 years is an awful rate.

However, my own opinion is not to fix for 2 years. Take a no-tie tracker or a 5 year fix.
 
The Halk said:
Yes indeed it would. That gives you a wide choice of rates.

3.99% for 2 years is an awful rate.

However, my own opinion is not to fix for 2 years. Take a no-tie tracker or a 5 year fix.
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All i can see are postoffice ones and leeds bs direct are lot cheaper with rates of less than 3%. Can't imagine the feee will be cheap though.
About £1500 fee for most and the Santander one is £0. Over the course of 2yrs that would be about £41 added to my 2yr mortgage deal i think? Or is the £995 added over the 33years or whatever of the mortgage? :confused:
 
Not sure about all the intricacies of other mortgages, however the ones I do are either part of the fee up front, or all of the fee up front.

E.g. you might pay 99 out of 999 up front, and the 900 is added to the total balance of the mortgage. I would be very surprised if any lenders made you pay the fee over 2 years.
 
I got a Santander fix for 5 years at 3.99% a while back, i was on the same SVR as you at 4.24 and while i could have got a slightly lower rate (2.99 with chelsea) there was a huge fee, i think £2000, so in the end i stuck with Santander with no fee and no surveys etc to go thorough to secure a new deal.
 
Hmm, less hassle but cost you significantly more over 5 years if your figures are correct.

On a 100K mortgage it cost you 3K more, before fees :(
 
The Halk said:
Hmm, less hassle but cost you significantly more over 5 years if your figures are correct.

On a 100K mortgage it cost you 3K more, before fees :(
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Swings and roundabouts isn't it, i wouldn't want to pay the 2k up front so over 25 years of the mortgage it would have cost significantly more to add the 2k to it than pay a higher interest rate for 5 years.
 
Shimmyhill said:
Swings and roundabouts isn't it, i wouldn't want to pay the 2k up front so over 25 years of the mortgage it would have cost significantly more to add the 2k to it than pay a higher interest rate for 5 years.
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No, it wouldn't have.

You paid 5K more over 5 years, if you'd capitalised the fee you could have paid a small amount more over 5 years and then just dropped the remainder of the fee as a lump sum payment.
 
The Halk said:
No, it wouldn't have.

You paid 5K more over 5 years, if you'd capitalised the fee you could have paid a small amount more over 5 years and then just dropped the remainder of the fee as a lump sum payment.
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No i haven't, i worked it out to being 3k ish more over 5 years on figures based on 3.99 vs 2.99 so 1k more than the 2k fee but interest over 25 years was obv more than this - paying the 2k off over 5 years at 2.99% was 300ish but you couldnt add a X amount over the monthly rate only pay off 500 chunks up to 10% per year.

Based on my likelihood of not overpaying and buying shiny stuff instead i based my calculations on that 2k ending up being paid over 25 years and the Santander deal worked out better.

It was not the cheapest potential deal but the cheapest no action deal hence i went for it.
 
So your mortgage is 60K, that means you did lose out on less.

Still though, you effectively paid £1,000 extra because you couldn't trust yourself to put the money aside... your choice of course, but a bit expensive.
 
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