Mortgage advice

[heisthegaffer]

evening all

I bought a new house last year and at the time could only get a 30 year mortgage, fixed for 5 years. As the property value has risen it's made me question whether it's worth chopping in the mortgage (which would incur about £7k in early redemption fees) and getting a new mortgage, again fixed for 5 years but as it's at a lower rate, I would pay the same per month roughly but for 4 years less.

Has anyone done this? What are people's opinions? Obviously I am not happy about handing over £7k but I'd be saving in excess of that over the 4 years less so worth it in the end.

Do we think mortgage rates will get any lower? Is it worth me hanging on for a bit longer, maybe the new year?

Thanks

[Sarnie]

How much did you buy it for?

How much do you think it's worth now?

How have you ascertained the new value?

Whats your current rate?

What rate do you think you can secure now? Have you incorporated fees into your calculations? Eg arrangement fees, valuations fees, solicitors, application fees?

Lots of variables to consider here...................

[heisthegaffer]

Sarnie said:

How much did you buy it for? £310k

How much do you think it's worth now? £350k

How have you ascertained the new value? Usin Zoopla and similar properties in the area - abit ball park but it's early days.

Whats your current rate? 3.7% i think.

What rate do you think you can secure now? circa 2.5%

Have you incorporated fees into your calculations? No but estimate them to be in the region of £1k - £2k.

Eg arrangement fees, valuations fees, solicitors, application fees?

Lots of variables to consider here...................

Thanks. As I say it's early says but it looks as though it could well be worth doin. The other aspect was actually borrowing a fraction more (£10 - £15k depending on the LTV impact) as I want to build an out house.

[otherman]

Do your early redemption fees reduce each year - they normally do, in which case you may not have reached the optimum swap time yet.
What you are suggesting is normal form for a first house rising in value, but 1 year in is early to move. Maybe you should go variable rate if you do move it, to avoid being back in the same position in another year or two.

[Sarnie]

heisthegaffer said:

Thanks. As I say it's early says but it looks as though it could well be worth doin. The other aspect was actually borrowing a fraction more (£10 - £15k depending on the LTV impact) as I want to build an out house.

A mortgage surveyor will base their valuation on sold properties, not what Zoopla says which is based on generic House Price Index's and also not what is currently for sale on right move etc...............