Please can someone help, panicking so much about mortgage

OK, let's not panic. Here is what you can do with NatWest.

You are an existing customer, so you can look at their remortgage rates here:
https://www.natwest.com/mortgages/mortgage-rates.html

You will see that you can get a 4.10% tracker for two years at a cost of £995 with an LTV of 60%.

The cheapest rates you can get for no fee are:
4.65% but you will need an LTV of 60%
4.75% with an LTV of 75%.

These are public rates, you may get better rates if you login to Manage My Mortgage.

We remortgaged last summer at 0.5% above base and we were expecting interest rates to fall quite significantlly this year. However, the Iran war changed things, but despite these shocks, the Bank of England has held interest rates at 3.75%. It is hard to see interest rates going up a lot in the next year unless something else unpredictable happens.

The measures taken by this government should get the economy moving in the next year and I think rates may fall gradually as a result.

You do not have to do anything until next year and at your current rate you should not remortgage immediately.

Without knowing your exact details, LTV and how many years are left on the mortgage term, it's hard to predict exact amounts. But you do have options. As a guideline, when I had a mortgage in 2003, the rate was 1% above base rate. The base rate was 6% and the rate would switch to 2% above base after a few years. My advisor said that I should switch to a better rate at that point. However, the base rate fell to about 0.5% so I was happy paying 2.5% when the time came. I'm saying this because it's a good rule of thumb, a tracker at no more than 1% above base (lower if possible) is really good value, even when interest rates are high.

Fixes are at 6%, so go for a tracker. You will be ok, you just need more information.

Yes, this.
Do speak to a mortgage broker. The two I've used were both so kind and helpful in what was a really stressful situation not dissimilar from yours (lower mortgage but no inheritance). It now doesn't look as if rates will come down as people expected at the beginning of this year. You sound understandably overwhelmed and a broker will really help to lay out your options simply.

£75K is a high wage for a single earner, but not as a household right?

I have no advice better than what's already been said, but just wanted to comment as a few people know have asked where 'all' of OP's money is going.

My husband and I earn similar between us, that is very much in the average/ low average range for a household no? But as a single parent @Pancis125 is probably more reliant on childcare, and possibly cleaners etc than we are. And possibly more limited in her capacity to take on more - whether that be more work, a second job or more hours. And also paying more in tax than an individual mid earner, and losing child benefit. It sounds like a lot but I'm sure it doesn't always feel that way!

Do you pay childcare ? Will that reduce anyone soon ?

Surely if you paid it now and then continued with the current mortgage payments that will give you a head start when it's time to renew. It would be50 k less from down payment and maybe a year of you paying £200 a month extra

On paper this is good advice and what I'd decided on and lined up until a couple of weeks ago when the weight of being a lone parent really hit and I realised I needed certainty. Got back in touch with my mortgage broker and they sorted me a fixed rate which is only £20 more than the (good) tracker, but crucially i can now sleep at night and listen to the news without panicking! Given how OP is feeling the fixed might be better.

What a thoughtful post. Many people in couples don't understand the weight, lack of flexibility and stress of being the only parent. I hope OP reads that one and gets some comfort.

We have just got a mortgage quote on a fixed rate at 4.84%. 6% is very high

You don’t need to lock in a new rent for the long term, you could pay a variable rate or just lock in for one year or so in the hope that they come down and then lock that in when it comes down. That obviously is a gamble as there is the risk they go up further but can pay off if they decrease.

Can you overpay each month to bring the principal sum down?

Otherwise, and I'd personally hate this but it's an option, could you get a lodger? Use every payment from them each month to overpay your mortgage, so when you remortgage the amount is much lower?

My dd locked in 4.69 5 year fix with NatWest last week. Where did you get 6% from?

You keep saying you can't extend because you're already at the maximum extension, but that doesn't track as you're coming up for renewal so have clearly paid off some years already and could extend back over that many years at least. Others have come up with some excellent suggestions but this just struck me as a panicked response rather than a fact that you'd found out from all possible providers. You also earn pretty well and the mortgage isn't for a huge amount (compared to some) so are a good customer that lenders will work with.

Not the point of this thread, but the cost of housing is just absolutely shocking now. A real disgrace and failure of government. Someone earning over 70k should not be worried about how to pay their mortgage/rent.

Its disgusting how little help single people get. I bet you are paying full council tax too - subbing out families for services you don't want and can't use. Can you find some kind of a cash in hand/tax free side hustle where every penny goes toward your mortgage rather than paying for overseas aid and asylum seekers? In your position I would not hesitate. The money you have needs to work for you not the bloody tax man.

I was thinking this.

unless a huge amount in childcare depending what age op child is

if it is childcare then this will reduce once at school tho obv need school holiday clubs etc

but from take home on £74k it should be Doable

Where are you getting a rate of 6% from?
Are you subprime?

If you look at https://www.moneysavingexpert.com/mortgages/best-buys/remortgage/results?mortgageChannel=Remortgage&repaymentMethod=Repayment&addFeesToBalance=false&requiredTermYears=25&requiredTermMonths=0&propertyValue=360000&mortgageAmount=280000&sortResultsBy=MonthlyPayment&firstTimeBuyer=false&borrowMore=false&onlyShowWithNoUpfrontFees=false

and put your details in, this will give you a better idea.

Generally the more equity you have (the lower the loan to value) the better rates you can get.

@Friendlygingercat , why do you think the OP is paying full council tax?? She should be able to get 25% single discount assuming her child is not over 18.
Why is it disgusting that single people get very little help? Surely it should be based on household income?

It's good that you are thinking about this, but really try not to panic. You have plenty of time to decide what to do and you have been given lots of good advice, I assume your £50k is in a high interest rate account, an ISA if you are paying significant tax?

As said just drawing down your lump sum to cover the increase in mortgage payments (when necessary) gives you a good safety net, and with your current monthly savings and pay increase going towards the mortgage payment you should be drawing the lump sum down very slowly just a few thousand a year.

Wow. You have managed to bring in asylum seekers to OP's thread. That is some dedication to spreading anti-asylum seeker crap.

There's no point looking now. It's unbelievably unpredictable, so the best thing you can do is park your fears until at least the new year.

Yes you can unless you are already at a retirement age of 80. Some lenders will lend past your 70th birthday. You can change term again down the line.

With respect, I am quite confused by your level of panic. At £74k, your take home should be around £4,275 (assuming a decent 5% pension contribution). With one DC and assuming they are in nursery with 30h free childcare, the most expensive nursery would still be at £800 so

£4275 - £800 (nursery) - £1600 (increased mortgage) - £150 (council tax) - £75 (car insurance) - £100 (fuel) - £150 (utilities) = a healthy £1400 for food and outings!!!!!

And that is without touching £50k inheritance money...

It’s 12 months away. By all means check in with your broker for reassurance, but it will be fine honest.

Can people PLEASE stop telling the OP to overpay. It would be a ridiculous thing to do while her rate is 2.7%. The £50k should be earning over 4% interest in an ISA, which hopefully it's already in, plus the OP has her £500 pa tax free interest savings allowance to use.

I also don't understand why she thinks her rate will go up to 6%, rates around 4.5% are available, so not as big a jump.

OP you could probably do with reviewing your spending to make sure you're on top of your budget and see if you can save more each month. You could use some of the £50k to supplement your income over coming years until your disposable income grows eg due to payrises or lower childcare costs, but with nearly £3k pm after your mortgage, you should be able to cover your costs and have a decent lifestyle.

I wouldn't pay the £50k off the mortgage, that could be useful for other things as well as a financial safety net. And as said above you should only be drawing it down very slowly to cover the part of the mortgage you might find difficult to pay preserving your safety net.

Using the 50k 1800 at a time to overpay while you have a low rate sounds like a good idea.

You can also shop around for a different provider who will offer a longer term - you can get terms up to 40 years, and it doesn't mean you can't repay early further down the line.

Otherwise put the house on the market and downsize unless you're already in a two bed.

There are always options, and you have time.