mortgage questions...
Discussion
so I should be able to remortgage in a few months time and want to lock into a deal sooner rather than later.
It might (might be possible)that I can get the rate down to 2.89 with free legals, valuation all of which come with a £495 fee which sounds good. That is a 2 yr deal @75% LTV .
With the same lender I'm looking at I also have the option of a 3 year deal at 2.99% with the same deal - free legal etc and £495 fee again at 75% LTV
the thing is that we can overpay quite a bit of the mortgage in the fixed period - about 2k a month so in essence we can pay off 10% of the capital each year. if we took the 2 year deal this would bring us onto over a 40% deposit which, if we had it at the moment would open up a whole raft of deals.
however 2.89 is still cheap. very cheap. the question is, do I lock in for a longer period, 3 years at 3% even though I wont be able to make good use of the increase in equity during that time but knowing that I'm on a good rate, or do I take a punt, do the 2 yr deal and pray that I havent made the wrong call and am remortgaging just when the rates are going up ( I suspect we wont see any meaningful increase in the boebr for about 24 mnths but who knows) and hope that I am paying 2-2.5% ish with my 40% deposit or do I bite the bullet and just concede that anything below 3% is a good rate whatever your LTV. I guess that if rates stay roughly where they are the payments would go down (on the remortgage with the increased deposit) to about £750 pcm @ 60% ltv compared to £950ish at 75% ltv. which is a fair difference.
we wont be in the flat 4 years from now I reckon but we probably will still own it.any thoughts? does any of the above make any sense?
It might (might be possible)that I can get the rate down to 2.89 with free legals, valuation all of which come with a £495 fee which sounds good. That is a 2 yr deal @75% LTV .
With the same lender I'm looking at I also have the option of a 3 year deal at 2.99% with the same deal - free legal etc and £495 fee again at 75% LTV
the thing is that we can overpay quite a bit of the mortgage in the fixed period - about 2k a month so in essence we can pay off 10% of the capital each year. if we took the 2 year deal this would bring us onto over a 40% deposit which, if we had it at the moment would open up a whole raft of deals.
however 2.89 is still cheap. very cheap. the question is, do I lock in for a longer period, 3 years at 3% even though I wont be able to make good use of the increase in equity during that time but knowing that I'm on a good rate, or do I take a punt, do the 2 yr deal and pray that I havent made the wrong call and am remortgaging just when the rates are going up ( I suspect we wont see any meaningful increase in the boebr for about 24 mnths but who knows) and hope that I am paying 2-2.5% ish with my 40% deposit or do I bite the bullet and just concede that anything below 3% is a good rate whatever your LTV. I guess that if rates stay roughly where they are the payments would go down (on the remortgage with the increased deposit) to about £750 pcm @ 60% ltv compared to £950ish at 75% ltv. which is a fair difference.
we wont be in the flat 4 years from now I reckon but we probably will still own it.any thoughts? does any of the above make any sense?
If you were my client I'd be advising you to take the three year rate.
I think you are really overthinking the differences in products. Once your sub 75% most of the products are similar.
Take the 2.99% and run, otherwise you are relying on a lot of variables out of your control to make taking the two year product the better decision.
I think you are really overthinking the differences in products. Once your sub 75% most of the products are similar.
Take the 2.99% and run, otherwise you are relying on a lot of variables out of your control to make taking the two year product the better decision.
3 pc is a great rate but would we be better off going offset given we can take chunks out of the capital everyyear?
the offsets ive seen seems pretty pricey to me and with the 3 yr deal I'm 99.9pc sure that we would then be remortgaing into a totally different climate which I dont think we are at that much of a risk at with the 2 year deal.
I dont want to be greedy though and catch a cold..
the offsets ive seen seems pretty pricey to me and with the 3 yr deal I'm 99.9pc sure that we would then be remortgaing into a totally different climate which I dont think we are at that much of a risk at with the 2 year deal.
I dont want to be greedy though and catch a cold..
princeperch said:
3 pc is a great rate but would we be better off going offset given we can take chunks out of the capital everyyear?
the offsets ive seen seems pretty pricey to me..
Yep, you pay a premium with an Offset product for the benefit of being able to access your money at any time, which they obviously want as they don't actually want you to pay the debt off!the offsets ive seen seems pretty pricey to me..
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