Q: Our mortgage offer expires in a few weeks and it is unlikely for the time we finish. Because Ive been shopping around and have a 10 years fixed rate mortgage at 5.05% (nearly 2 years as well as the 4.89% we lose). The arrangement fee added to the loan, is ￡ 895, but because we would not need to remortgage every few years, this would save money in the long term.
Assuming that our offer we will not get extended, this would be a good mortgage to go instead, instead of just going for the “new version” of our expiring mortgage now 5.34% for 2 years down ? We would lose ￡ 280 valuation fee, but the end product at our cost mortgage has now risen to 10 years determined ￡ 999.
The is portable, so we can pass if / when we go within the period of 10 years. Ive scoured the market and this is the best I could find 10 years down, and I just like the stability of knowing exactly what I will have to pay for 10 years without worrying about the price crashes, interest rates rise, etc what is a historically low rate of 5.05%.
Email them as an enquiry. I enquired about something and they responded. I like a company that actually replies to emails.
Unfortunately I don't think I will be applying afterall – I found out from my broker today that (a) my current company are willing to give me a 3 week extension on my current 4.89% 2 yr fix deal, and (b) if I decide not to go with them, I will lose not only the ￡280 valuation fee, but also the ￡499 product fee which we added to the mortgage (it seems strange to have to pay a product fee if you don't actually accept the product, but hey). That's with Alliance & Leicester.
So good luck everyone who goes with the Derbyshire.
The application fee is ￡849, which is payable before completion, there is also a booking fee of ￡150 (totaling ￡999, all payable before completion, not added to the mortgage).
Funnily enough they also do 5.05% for a 10% deposit.
I think you've found the source!
The application fee is ￡849, which is payable before completion, there is also a booking fee of ￡150 (totaling ￡999, all payable before completion, not added to the mortgage).
Funnily enough they also do 5.05% for a 10% deposit.
I'm worried if I reveal my source, everyone will apply and it will be taken away before my original mortgage offer expires! After double checking it's actually a ￡999 application fee, ￡150 of which is taken up front and non-refundable, ￡849 added to the mortgage. However, the valuation fee is lower than what we paid for our original application.
APR on the deal I would go for is 6%. There is a sting in the tail with regards to paying off during the fixed term (5% during first 5 years, then 4%, 3%, 2%, etc) but it does allow overpayments of up to 10% of the balance each year.
If I was to find myself with a large inheritence, not being able to pay off the mortgage with it straight away wouldn't be a problem – afterall, the interest rate for the mortgage is lower than the best savings accounts out there, so I'd just stick the lump sum away and pay off the mortgage at the end of the fixed period.
To me, the risk of interest rates falling significantly below 5.05% for any significant period of time seems unlikely, especially as we're still in times of historically low rates and inflation is creeping up.
Then apply for the offer now and share it with everyone else. hardly prudent to come asking for advice then not share your finding's with those who offer the advice.
I'd agree 5.05% is a great rate in todays climate and if it where me in your shoes I'd snap it up.
Martin.
I have a First Direct fixed rate offset mortgage at 5.39% for seven years. The fees were £400 (fixed rate booking), £300 (arrangement) and valuation for £180 (for £160k property). although I had a full building survey at £630.
You can make overpayments as much you like providing you don't pay off in full during the fixed rate period (but if you did this, then the rates are a bit lower than quoted above – 3%, and then 2% etc.)
They still have a similar offer for ten years fixed rate at 5.49%
Ash
I'm worried if I reveal my source, everyone will apply and it will be taken away before my original mortgage offer expires! After double checking it's actually a ￡999 application fee, ￡150 of which is taken up front and non-refundable, ￡849 added to the mortgage. However, the valuation fee is lower than what we paid for our original application.
APR on the deal I would go for is 6%. There is a sting in the tail with regards to paying off during the fixed term (5% during first 5 years, then 4%, 3%, 2%, etc) but it does allow overpayments of up to 10% of the balance each year.
If I was to find myself with a large inheritence, not being able to pay off the mortgage with it straight away wouldn't be a problem – afterall, the interest rate for the mortgage is lower than the best savings accounts out there, so I'd just stick the lump sum away and pay off the mortgage at the end of the fixed period.
To me, the risk of interest rates falling significantly below 5.05% for any significant period of time seems unlikely, especially as we're still in times of historically low rates and inflation is creeping up.
Assuming that we won't get our offer extended, would this be a good mortgage to go with instead, rather than just going for the "new version" of our expiring mortgage which is now 5.34% for the 2 year fix? We'd lose the £280 valuation fee, but the product fee on our expiring mortgage has since gone up to £999.
The 10 year fix is portable, so we can transfer it if/when we move within the 10 year period. I've scoured the market and this is the best 10 year fix I can find, and I kind of like the stability of knowing exactly what I'll be paying for 10 years without having to worry about price crashes, interest rate rises, etc, at what is still historically a low rate of 5.05%.
I am not an IFA but adding £895 for ten years at 5.05% p.a seems a little expensive and does add up.I would see if they let you pay it in full or if you can't consider another deal.
The idea of a ten year fixed deal can also be worrying.Things can change with peoples lifestyles.You maybe due some inheritance from a parent.Sorry but things can happen when you least expect it.If you then decide to pay off your mortgage that could be very costly in fees.Have you worked out the penalties if you had to get
out of the deal beforehand.Don't expect the lender to be nice if you get problems.Do your sums and don't just look at the low rate.
What about your deposit.Hopefully you are not being charged any Loan to Value rates.My guess is you are asking for a mortgage around 75% of the valuation.
I would personally do alot more searches.In my position I would opt for a 5 year deal fixed with
hopefully no fees at all and hopefully a valuation fee or some solicitors fees returned from the lender as a sweetener.I would also hope to see if after 5 years I could leave without any penalties,but I may opt to stay on their variable rate for a year.
Of course your 5.05% looks great but I would expect my starting rate to be higher than that without any charges.
Probably half of on % higher to 5.39%+
What's the APR you have been quoted?
Unsure how the final balances work out on paper,but alot of sites can give you a calculation when you input your figures.
Finally if you do leave your present company check that their exit fees agree with your original contract when you joined.You may want to claim otherwise.