Remortgaging- staying with current lender Natwest

[becca2203]

Hello!

Just looking for some advice/previous experience (and no judgement because I'm giving myself enough of a hard time 🙈).

So our fixed mortgage is up in May next year (I know, forward thinking), the broker said he would get in touch 6month before it was up which I know is still a way away!

My husband wants to reduce our term when it comes to renewal, but that will be a new mortgage effectively?

My worries are (I am a natural worrier!) That our options are going to be limited, since our mortgage last year, our credit card debt has increased quite a bit due to things for the house, and we have also got 2 loans now, one for a car and one for a motorbike.

If we stay with natwest, I understand you just transfer to a new product and it's simple? So they wouldn't run checks/new application? So then I could stop stressing about the thought of doing it all again!

I had thought, we could transfer to a new product and hopefully the interest will be lower than our 5.99% we are on just now, and then that would allow us to make over payments which in turn will pay off the mortgage sooner, rather than reducing the actual term? For now anyway until we get our credit card balances down.
We could afford the overpayment if interest rates were lower than 5.99% because we manage fine, so say it was £630 a month, we could over pay by £100 because that's what we pay just now.

Just looking for reassurance because my heads in a spin!

they do check i beleive - often best to stay with current if you paid on time - two of our kids remarogated same lender - both paid penenailtes to come out a few months early from fixed - all thanks to that Liz Truss

if you change to another lender that will be a remortgage with full credit check and income and affordability checks. If you stay with NatWest you will be able to switch into a new product without any checks - it can usually be done online.

depending on rates though, a remortgage to another lender may work out cheaper than staying with NatWest so it may be worth the hassle of moving. Most lenders will do an agreement in principle so you have an idea of whether you meet their criteria before doing a full application.

NatWest may let you reduce the term without any checks, you would need to ask them I think.

I would do the same as you and keep the term the same and overpay. That way you would still be paid off sooner but you aren’t obligated to pay the higher amount and you have some flexibility if you need it in future. One thing to remember is there is usually a limit to what you can overpay without incurring nearly repayment charge - 10% of your balance is usual.

My husband wants to reduce our term when it comes to renewal, but that will be a new mortgage effectively?

There is a Plan B. Overpay the mortgage (you can do that now). The overpayment will have the effect of reducing the overall term of the mortgage whilst retaining the flexibility of choosing to drop back to the standard monthly repayment whenever you need to free up some cashflow.

We've been overpaying since the start of our mortgage and we're on track to repay 6 or 7 years ahead of the mortgage term.

You do need to check how much you can overpay without penalty, and how much of an overpayment you can realistically afford.

I renewed with NatWest a couple of months ago. I would have been happy to change providers but NatWest had the best rate so I just stayed with them. My broker did ask me for bank statements/payslips as part of the process for due diligence. But I'm pretty sure she told me that NatWest didn't need to see any of those, they just transferred me over to the new product

I'm not with natwest but barclays. When I came to renew (I knew I'd struggle as have an ill health pension and disability benefits). Broker advised best to stay with barclays and when I rang to discuss shortening the term I was advised I'd need to go through a whole new application therefore they worked out what payment would be equivalent to me shortening the term and I set up a direct debit for that amount.

Also not NatWest but I also had the experience on renewing that if I wanted to reduce the term with the same lender it would require a new application. I also just worked out the overpayment required and made that rather than go through the hassle of reapplying.

I would keep the same term and overpay as it gives you flexibility.
Just check you can overpay if this is what you want to do, usually you can to about 10% of the balance

Definitely over pay as opposed to shortening the term.

Natwest overpayments are 20% of the outstanding balance I think.

I don't think you'll get a fixed rate much cheaper so don't get your hopes up.

If you stay with NatWest you'll probably not have as much hassle with valuations and the like.

Is it likely the things you've done to the house will increase its value significantly? Enough to push you into a different loan to value rate? That'd be cheaper. But you'd have to get a survey.

Are your loans fixed rates so it wouldn't make it any cheaper if you remortgaged and took out money to pay them off? It could help with regard to the credit card though?

What's your plans for retirement. Do you have good pensions that you can Chuck in working at 50 or whatever?

If not, Sometimes increasing the term to decrease the monthly payments has to be done to afford you a standard of life.

What's the point of sheer drudgery and no nice things in life for the next decade or longer.

I'm menopausal now and I don't have the energy to do all the wonderful things I promised myself in retirement. I'm too stiff and tired! Nobody tells you that when you're young, it's all about pay off your mortgage as soon as possible. Don't increase the term.

But realistically now we have to work until over mid 60s, the time we have left to enjoy life and smell the roses along the way has decreased.

So while, in the past, my opinion was to pay off everything and retire early, now I know I won't be able to finance that, I'm increasing my mortgage term so I have money now to do the things I want.

Something to think on. If you're pension plans are good and you have a good salary just now fine. If not you might want to think about what your priorities are and how to get there.