Mortgage Rate Rises

DJMK4 said:
Yeh i know, this is why im probably going to snub virgin money, if i had a decrecing ERC i may have been able to lock in to a lower rate from mid last year, this is why i have had to wait until now,

as my 5 year Fix from starting in 2018 had a 4.5% ERC, of course being a first time buyer then, i did not realise, and my broker didnt say much about the ERC terms, i was nieve as i was just happy to get a place.


Now a decreasing ERC is top of my list of wants in a product
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Same. Didn't have a clue. Was just by luck TSB had a 3,2,1 fee on the 3 year which I had.

I think santander were bad. 5pc throughout or something!

But yeah as a FTB no one at any point even brought up that ercs were different. Just that there was one.
 
I'm with Santander and stuck on a 5% ERC charge. Luckily I'm fixed on a low rate for a couple more years (3 years into a 5 year fix). If I end up moving within that timeframe, then I'd likely end up porting the mortgage, but it would've been nice to have the option to shop around if their charges weren't so high.
 
Damn I was just looking at Santander as the 5 year is 3.99%

I have emailed.L&C again as the broker has not given to much info on.the ERCs on the options he gave me ,i keep asking what the % is and if it's decreasing but he wants me to pick an option then he will look for the finer details , he just says ERCs involved or ERCs not involved on one of the trackers

I'm probably going to fix for either 3 or 5 year

Argh I really don't know now . Fix for 5 then ? Sounds like the base rate will level out at 4.5 by the end of this year into next, then fall very very slowly after the years? If it's taking years to fall then I may aswel just fix, gives me security that they won't go higher but I' will have to.wait.for the term to be up to remortgage or pay an erc
 
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dLockers said:
You can port your product so unless your mortgage is either a) low enough, b) you have the capital to pay an ERC, it is pretty unlikely you'll pull that trigger?
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If rates go down a couple of percent over the next year or two and your ERC is low it might start looking attractive to remortgage. There's a good chance they won't too, but for this and other reasons I definitely prefer the additional flexibility of a low ERC if it doesn't make much difference to the cost.
 
EvilRob said:
If rates go down a couple of percent over the next year or two and your ERC is low it might start looking attractive to remortgage. There's a good chance they won't too, but for this and other reasons I definitely prefer the additional flexibility of a low ERC if it doesn't make much difference to the cost.
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Yeah for sure, if it makes no difference. But if you are gambling that much on rates going down, just fix for 2 years and pay no ERC at all.
 
dLockers said:
Yeah for sure, if it makes no difference. But if you are gambling that much on rates going down, just fix for 2 years and pay no ERC at all.
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I haven't found that ERC terms have made much difference if any at all to the fixed interest rate in my last couple of remortgages, so it's no gamble just added flexibility. If having a higher ERC saves money, then sure, I agree.
 
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EvilRob said:
Why if you are going to be locked in tight with a 5% ERC?
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Surely that's 5percent of what's left of the term? We looked to end our last year when we considered moving, and each month it would be less and less than the month before. It was still a good chunk of money, about 13k iirc, plus than agency fees, higher stamp duty this time as it'll be our second purchase, etc we decided against it
 
DJMK4 said:
All I'm reading in this evenings mortgage news is lot of lenders pulling the below 3.99 % of the shelves as rates rising
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I'd say 3.99 is a good rate for the next 12 months.
I'd expect it to drop in 3 years. But obviously not a guarantee.

But it is poor might not be much less.

Is also possible it could be more.



This advice was brought to you by your local ambiguous politician
 
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unwashed potato! said:
Surely that's 5percent of what's left of the term? We looked to end our last year when we considered moving, and each month it would be less and less than the month before. It was still a good chunk of money, about 13k iirc, plus than agency fees, higher stamp duty this time as it'll be our second purchase, etc we decided against it
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Yeah it is. Hence for people early it's very very bad to have a high erc. I'll never sign up for one which isn't a 1pc for each year. So a 5 year is 5,4,3,2,1 erc each subsequent year
 
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413x said:
I'd say 3.99 is a good rate for the next 12 months.
I'd expect it to drop in 3 years. But obviously not a guarantee.

But it is poor might not be much less.

Is also possible it could be more.



This advice was brought to you by your local ambiguous politician
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is there any other lenders doing a 3.99% rate at the moment with a decreasing ERC?
 
DJMK4 said:
is there any other lenders doing a 3.99% rate at the moment with a decreasing ERC?
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I don't know. I haven't really looked. Just from what I've heard. I thought most did decreasing and that fixed ercs were the exception. But I fixed in 2022 so not up to date right now

I know my lloyds 5 year is 5,4,3,2,1. It was one of my first questions to the bank!

Edit. From what I recall it was only virgin and santander that had nasty ercs but I didn't look at too many (only the best 5) and only did it myself, but not with a broker.
 
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413x said:
Edit. From what I recall it was only virgin and santander that had nasty ercs but I didn't look at too many (only the best 5) and only did it myself, but not with a broker.
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They do yes, as i mentioned before im currently with Virgin

I need to make a choice in the next week or two really now
 
Spoke to L&C again, they said that a product fee based product vs a non product fee based option wont be much difference in monthly cost,

They have found a product with a 5 year fix with a high street bank, decreasing early repayment charge, £500 cash back on completion - 4.18%,it has a £500 cashback offer.

If you went for the one with the product fee which was coming out at a 3.99 rate i think, - product fee i dont think i can be bothered to pay upfront, if i add it to the morgate id end up paying about £5 less than the one without a fee, so why not go for the one without a fee?




Still comes out higher but i think ill just have to bite the bullet, £740 per month one with a decreasing ERC. - so approx £128 more than what im paying now per month





I dont really know what else to do , dont think im going to go any cheaper and I dont know if i should go with a tracker, which will be more expensive, i cant see rates dropping too quickly over the next 3-4 years
 
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I feel like I'm in limbo at the moment.

5 year fix ended this month (2.14%). I didn't bother fixing again because I missed the boat on most deals when switch time came around back in Nov/Dec.

I was contemplating moving over to a tracker for a bit, the rate increas early Feb and inflation not moving much made me think twice about that route. I don't need the stability, I have enough headroom to be able to ride out a significant rate increase but don't like giving banks more of my hard earned money than I need to :D

I've noticed rates are dropping slowly bit by bit. HSBC 2 year (fee free) was 4.54% a week or two ago, it is now 4.44%. I think it was around 4.8x earlier in January.

I'm just trying to decide how long to stay on the SVR at 6.79% before I fix. The longer I stay on the SVR the more it eats away at any saving over the period anyway so it is a tough choice at the moment. Pull the triger on a 2 year fix or wait a little longer in hope of a better rate?
 
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