Mortgages what’s everyone’s plans

[Clockwatching54321]

Anyone got a deal ending next year?

Our 5 year fix runs out next summer and I think
we have 3 options:

1. pay the early repayment charge now and get another fix (not the best option at the moment)
2. get another mortgage deal but not execute until the last minute (6 months from now) and pay the early repayment charge then (hoping the deal doesn’t get pulled)
3. wait it out on the 2% fix and overpay as much as we can and see what happens next summer

How much is the repayment charge?

How much could you put aside between now and when the mortgage deal ends?

What is your LTV?

I probably wouldn't get out of the mortgage early, purely because the charges are usually pretty high and you are gambling on rates rising enough to make that charge worth it.

Option 3.

In a similar situation, our mortgage is up end of May 2023. We have looked at what the cost would be to end now and fix for the next 2 years. The fees are just over £1500 and would be a extra £173pm from what were paying currently.
We have spoken with our current provider and some brokers, we can secure our next deal without fees on 1st dec, currently we plan to hang on till then and hope and pray but we are also over paying monthly.

@princesssparklepants Our early repayment charge is just over 2k so it’s a hefty amount.

We have 10k we could over pay by now and this is within our deal with no charges.

LTV is 56%

Current deals are looking at 4.5%, but guess we ate just worried about it going higher.

I think we are going over over pay as much as possible without a charge and then wait till the end of our deal to switch. We have an appointment with a mortgage advisor in a few weeks to triple check.

@LetsBekindx that’s a good plan, I think ours is feb before we can switch. We will be watching and maybe doing the same, over paying and then switching to a new deal if the rates are still going up.

Check your rates - we apllied today for one with barclays at 3.05% with a higher ltv

I can switch now as mine runs out in feb gone from £662 a month to £989 if I want to fix for 3 years 😓

astronomical amount of extra money and I’m not gaining anything.

I could cry

With nationwide, variable is not to bad atm

Just got off the phone to my IFA. Our current & new figures are almost identical to yours & I am distraught. We already struggle. God I wish I'd done a 5 year fix 2 years ago 😭

Our deal runs out in 2024 then we have 5 years left. I'm planning to pay off a chunk early to get the term down.

There is a calculator on MSE for whether it's worth ditching or not.

With 10k to throw at the mortgage I maybe inclined to throw it now and pay the redemption charge. But it all depends what you are comfortable with.

Will paying off the additional 10k take you into a new LTV bracket? I'm guessing not.... so possibly wouldn't make a huge difference to the deal you could get in a few months times.

I would use an online calculator and look at what different rates will do to your monthly payment. And see how you feel.

Rates aren't going to come down, so your best car scenario is that they just don't rise anymore - but chances are, they will

We owe £42.

The ERC is & 600, they can whistle for it.

So £2.00 a month and 8 pence interest, it is costing them much more than me. 🙄

I've looked into 1). My lender says I need a telephone appointment with one of their mortgage advisors to do that. First available appointment middle of November. Will almost certainly be too late to gain an y advantage by then.

2. Isn't an option from my lender - it's either take what we're offering (on the day of the above appointment) and pay the current ERC, or wait until 6 months before my fix ends (Dec 2023).

Looks like 3) is my only real option.

@princesssparklepants thank you just did the calculations on mse and it’s currently saying not to ditch our current mortgage.

@altmember yes this is the other issue trying to get through to speak to anyone!

@organisedmother yes I have seen the variables are better, it’s a scary thought as I think they will keep increasing. Think we are going to wait it out and try to hammer the mortgage as much as possible…cross all fingers and hope for the best?!

@Passthewinebottle oh no It’s so unfair isn’t it! We owe 143k and I always felt luck to have a small Mortgage and if I even had a extra 50k on tht I would probably have to move.

And my best friend is a mortgage advisor and the best she could get me was 4% but I wouldn’t even be able to change mortgage lenders as our salary is less now I’m a SAHM 🙃

Option 3 but I wouldn’t overpay. I’d save that money to help subsidise your new payments. Perhaps go variable for a while. Fixed rates are mad currently. I’d wait for everything to settle down. I reckon they will be lower next summer or winter.

We are in the same position as you OP and have decided on option 3 and keeping everything crossed 🙁

Are you sure that is would be possible for the lender to pull the offer in option 2? We’ve applied for a fix for 5 months time when our current fix ends and our broker presented it as a no lose option as lender is committed to the rate once they make the offer but we don’t have to go ahead with it if things magically improve by next feb.

@Circe7 that’s good to know, I had heard of lenders pulling offers but wasn’t sure if it was hear say! Might be a good option to get something in writing then weigh up options like
your doing. Good to know others are trying to do the same thing.

I think we are going to overpay as much as we can and get a mortgage offer we can execute if needed in March next year. Then we have two options on the plate.

I'm not sure that makes much sense - if you've earmarked savings to go towards your new payments, you're surely better off paying down the mortgage before/as soon as the higher interest rate comes in? Otherwise you're throwing more away as interest. If you find yourself struggling at that point, it may be possible to lengthen your mortgage term to reduce the monthly payment. But then that's going to cost you more in interest over the long term.

I'd speak to your lender or a mortgage advisor to see how soon you can lock in a new rate. HSBC lets you do it 4 months prior to your fixed term expiring. So I was lucky and got a "lower" rate compared to how high it has jumped in just a matter of weeks.

If you've got a good amount of money to push into your mortgage at the end of the term, I'd just wait it out and fix at the earliest opportunity, as your payments will be brought down anyway with more equity.

princesssparklepants · 03/10/2022 15:43
There is a calculator on MSE for whether it's worth ditching or not.

could someone post a link please? I googled it but couldn’t find the right one
tia

I am in the same position OP
worrying times