Mortgage: Fix for 2 or 3 yrs in current 'pre-Brexit' climate
Discussion
After the other house purchase fell through last year (US based vendors wanting additional 10k owing to Brexit vote's effect on the exchange rate) we've hopefully (fingers crossed) got another house on the cards.
I've spoken to my mortgage advisor, he has run a few figures resulting in a couple of options:
1) Fixed rate for 2 years, variable thereafter.
2) Fixed rate for 3 years, variable thereafter.
Both are offset mortgages. Both are with the same company. My understanding is that after the fixed rate is up, there is the option of negotiation for a further fixed term etc.
The difference is that the 2 year fixed is ~ £200/month cheaper saving a not insignificant £4800 over 2 years.
It seems that article 50 will be actioned in the next 2 years and despite predictions, no-one is certain how things will pan out (in the short term at least). It doesn't seem as though anyone is expecting major interest rises however.
With this in mind, is it better to fix for 2 years, have 5k in hand and see where we are in terms of renegotiations in 2 years? Or is it better to pay the higher rate but be secure in the knowledge that during the next 3 years we don't need to worry?
Would appreciate your advice/opinions. TIA
I've spoken to my mortgage advisor, he has run a few figures resulting in a couple of options:
1) Fixed rate for 2 years, variable thereafter.
2) Fixed rate for 3 years, variable thereafter.
Both are offset mortgages. Both are with the same company. My understanding is that after the fixed rate is up, there is the option of negotiation for a further fixed term etc.
The difference is that the 2 year fixed is ~ £200/month cheaper saving a not insignificant £4800 over 2 years.
It seems that article 50 will be actioned in the next 2 years and despite predictions, no-one is certain how things will pan out (in the short term at least). It doesn't seem as though anyone is expecting major interest rises however.
With this in mind, is it better to fix for 2 years, have 5k in hand and see where we are in terms of renegotiations in 2 years? Or is it better to pay the higher rate but be secure in the knowledge that during the next 3 years we don't need to worry?
Would appreciate your advice/opinions. TIA
Apologies, I was going by the (seemingly crap) notes my wife was taking at the time (she hasn't written the % rates, just 'approx' monthly payments).
It's a Professional Mortgage from Scottish Widows:
http://www.scottishwidows.co.uk/extranet/products/...
LTV 80%
Balance 600k
2yr: Fixed 1.79, variable 3.74 (£2482/m payment in the fixed term)
3yr: Fixed 2.29, variable 3.74 (£2629/m payment in the fixed term)
As such, ignore my ~£200/m comment. More like £150m = £3600 over 2 years.
I've contacted my mortgage guy and he'll get me exact details later today.
It's a Professional Mortgage from Scottish Widows:
http://www.scottishwidows.co.uk/extranet/products/...
Sarnie said:
What are the rates, balance, payments and LTV?
Judging by the values on the site:LTV 80%
Balance 600k
2yr: Fixed 1.79, variable 3.74 (£2482/m payment in the fixed term)
3yr: Fixed 2.29, variable 3.74 (£2629/m payment in the fixed term)
As such, ignore my ~£200/m comment. More like £150m = £3600 over 2 years.
I've contacted my mortgage guy and he'll get me exact details later today.
g3org3y said:
Judging by the values on the site:
LTV 80%
Balance 600k
2yr: Fixed 1.79, variable 3.74 (£2482/m payment in the fixed term)
3yr: Fixed 2.29, variable 3.74 (£2629/m payment in the fixed term)
As such, ignore my ~£200/m comment. More like £150m = £3600 over 2 years.
I've contacted my mortgage guy and he'll get me exact details later today.
Do you specifically need an Offset Professionals mortgage?LTV 80%
Balance 600k
2yr: Fixed 1.79, variable 3.74 (£2482/m payment in the fixed term)
3yr: Fixed 2.29, variable 3.74 (£2629/m payment in the fixed term)
As such, ignore my ~£200/m comment. More like £150m = £3600 over 2 years.
I've contacted my mortgage guy and he'll get me exact details later today.
You are paying a heavy premium for those facts....1.79% rate Vs 1.39% available from other lenders.......£1499 fee Vs sub £999 fee from most other lenders........
Unfortunately yes. I'm a GP partner (rather than salaried) so essentially self employed in a business. Income is based on monthly drawings and is variable +/- 2k.
It seems quite difficult to apply for mortgages in this state as providers request 3 years of personal accounts. I only joined the partnership in Sept 2015 so that is not possible.
For the last (successful) application, I needed to submit documents from both the accountant and senior partner regarding profitability of the business and projected income.
It seems quite difficult to apply for mortgages in this state as providers request 3 years of personal accounts. I only joined the partnership in Sept 2015 so that is not possible.
For the last (successful) application, I needed to submit documents from both the accountant and senior partner regarding profitability of the business and projected income.
g3org3y said:
Unfortunately yes. I'm a GP partner (rather than salaried) so essentially self employed in a business. Income is based on monthly drawings and is variable +/- 2k.
It seems quite difficult to apply for mortgages in this state as providers request 3 years of personal accounts. I only joined the partnership in Sept 2015 so that is not possible.
For the last (successful) application, I needed to submit documents from both the accountant and senior partner regarding profitability of the business and projected income.
Not all lenders require 3 years personal accounts........many would consider this, especially if you gone from being a GP within the practice to a partner in the practice......It seems quite difficult to apply for mortgages in this state as providers request 3 years of personal accounts. I only joined the partnership in Sept 2015 so that is not possible.
For the last (successful) application, I needed to submit documents from both the accountant and senior partner regarding profitability of the business and projected income.
Sarnie said:
g3org3y said:
Unfortunately yes. I'm a GP partner (rather than salaried) so essentially self employed in a business. Income is based on monthly drawings and is variable +/- 2k.
It seems quite difficult to apply for mortgages in this state as providers request 3 years of personal accounts. I only joined the partnership in Sept 2015 so that is not possible.
For the last (successful) application, I needed to submit documents from both the accountant and senior partner regarding profitability of the business and projected income.
Not all lenders require 3 years personal accounts........many would consider this, especially if you gone from being a GP within the practice to a partner in the practice......It seems quite difficult to apply for mortgages in this state as providers request 3 years of personal accounts. I only joined the partnership in Sept 2015 so that is not possible.
For the last (successful) application, I needed to submit documents from both the accountant and senior partner regarding profitability of the business and projected income.
Sarnie said:
Not all lenders require 3 years personal accounts........many would consider this, especially if you gone from being a GP within the practice to a partner in the practice......
Went straight into partnership at this practice. Had a year as a salaried GP prior to this at another practice.When my wife applied for a mortgage a number of years back as a junior doctor it was very difficult as her salary changed every 4 months owing to the banding applied to the different specialties, not to mention essential changing employer (trust/hospitals) every year.
g3org3y said:
Went straight into partnership at this practice. Had a year as a salaried GP prior to this at another practice.
When my wife applied for a mortgage a number of years back as a junior doctor it was very difficult as her salary changed every 4 months owing to the banding applied to the different specialties, not to mention essential changing employer (trust/hospitals) every year.
I get it, I have a fair number of GP clients........I do think that you could source this elsewhere, cheaper.......but appreciate that this may seem like the default/easier option........but it's an expensive option especially on a £600k balance.......When my wife applied for a mortgage a number of years back as a junior doctor it was very difficult as her salary changed every 4 months owing to the banding applied to the different specialties, not to mention essential changing employer (trust/hospitals) every year.
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