Remortgaging - fixed or variable etc?

[WishIwasCherryMenlove]

Hi,

Our fixed rate deal with Yorkshire BS comes to an end in July so starting to research mortgage deals - I think if we don't switch we go onto their standard variable rate.

Anyone got any inklings about whether it's better to find another fixed deal for a few years or go onto the variable rate?

Also, I've never switched before ... will there be lots of fees in re mortgaging? I understand there would be a lender's fee but for example do we have to instruct solicitors etc. ?

Thanks

Everything I hear at the moment is that the base rate is unlikely to change from 0.5% for at least a couple of years. So the SVR with most lenders is a very good option. But the decision really hangs on how your finances are fixed. If the rate went up a percent or two and if you had to find an extra £100 or £200/month would that be a 'train-smash' or would you be able to absorb the increase, no problem? If you'd struggle to find extra money you may decide that a fixed rate is better on your peace of mind. If you think you could absorb an increase, stay on the SVR, see how it goes, and reassess this time next year.

I've switched mortgages lots of times in the last 20 years in order to get better deals and always use an independent mortgage adviser. I find they are very good at filtering through the deals & finding the right one for my needs, organising the paperwork and I've never paid for their services.... they get their fee from the new lender. As for switching fees I think last time I paid £50 or similar for adminstration (Cheltenham & Gloucester). No solicitors have been involved.

I was thinking about coasting on the SVR for a bit as well, I have too many other admin jobs to think about remortgaging straight away, although I would prioritise it if I thought there was a risk of interest rates shooting up.

What I intend to do first of all, though, is see what deals my current lender has - last time they offered me another fixed rate when my first one ended. Worth a call to the Yorkshire at least to see what they can offer?

Speak to Yorkshire. Their SVR is quite high, however they've got some good deals that you can switch to if your current mortgage is coming to an end and many of these are fees free as they'll want to keep you. Can you guess who my lender is?!

Thanks all
Probably first step is chat with ybs then

This is going to sound like an idiotic question but if we just go onto the ybs svr in July would we then have to pay a get out fee if we later find a new deal with another lender ?
(mortgages seem to be very complex, I'm embarrassed to say I'm a legal type but find mortgages totally baffling!)

Usually with SVR there is no early repayment - so you're free to move to a different mortgage if you want to. We went on to SVR about a year ago - we thought about moving to a new fixed rate, but because house value had decreased so had our LTV so fixed rate would have been higher than SVR. SVR is suiting us at the moment - paying about £200 a month less than our previous fixed rate

I would look at Natwest. I'm remortgaging next month and have just started looking. They seem to be giving money away as they have offered to lend me 5.5 times what I earn!! Absolutely crazy. I could move to a mansion. No idea how I'd ever afford to repay a mortgage that high.

If you go on to SVR there shouldn't be a penalty for moving at a later date as you aren't on any kind of discounted rate (which usually would have penalties).

You need to compare the costs - our deal is finishing in March and I'm currently looking at deals.

Most lenders have a product / application fee which seems to be around £1000 at the moment. Some of that is payable upfront (the ones I've looked at are £195 upfront and the rest is added to the mortgage) and then depending on the lender, you will have to pay a valuation fee (around £400) and solicitors to process the paperwork (£100-£200). Some lenders will waive these charges depending on the mortgage deal you go for (they call it "fee assistance"). We're currently with Nationwide, even if we stay with them, we have to pay £995 for a new mortgage, but we'll get £300 cashback for staying with them. Also, if you stay with the same lender, on the basis that they got a valuation when you first had a mortgage with them, you won't have to pay for another valuation or any solicitor fees.

We're only looking for a 2 year deal and so I've looked at trackers and fixed rates (as I agree with others, Bank of England rate unlikely to change too much). Having said that, individual companies are pulling deals. When I started looking just before Christmas, Nationwide were offering a 2 yr fixed rate of 3.79%. When I looked in between Christmas and New Year, that had been withdrawn and their cheapest 2 yr fix was 3.89%. I looked again yesterday, and its now 3.99%. I think you can "reserve" a deal upto 3 months before your deal ends so its definitely worth looking round. I find moneynet.co.uk useful if you click on the remortgage section.