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Hi all,
my current deal has just expired, and monthly repayments have shot up by £100, as moved on to a variable rate.
Myself and the OH will be looking to move next year, around June/July time, so are wondering what the effects could be if we tie ourselves in to a 2 year fixed rate? They guy at Santander said he could not guarantee the mortgage could be transferred to another property, and it is less flexible, so we may not be able to access the best deals.
What would others recommend doing in this situation? The salesman said that moving to any tracker does not tie you in. However I would be paying slightly more a month until we move in just under a years time.
If you are definitely moving then you need to find a deal with no tie ins (such as a tracker) as you'll lose any savings if you need to buy yourself out of a locked in deal. Even if you could move the deal to the new property there's a good chance you'll be borrowing a different amount anyway.
Any reason you have to stick with Santander? There are many more mortgage companies out there and one of them may offer something more suitable for you. I bet there is a hefty fee to pay for the tracker deal too
We sold a property, paid off a mortgage and started a new mortgage for the new property we "bought". Different mortgage providers , through a broker.
If you are planning on selling before your 2 year deal runs out you may be liable for early payment fees.
Not really looking to stay with Santander, am happy to move providers. Is it all a fairly easy process? As This will be the first time of doing this.
Will have a look at trackers, so not tied in, I think that may be the way forward.
The trackers not being tied was just a Santander current offering thing and this varies with different providers and different deals. Check the charges and conditions on any deal you look at
Can you switch on to a new tracker rate with Santander to tie you over until you move? That should save you having too much hassle with affordability assessments and legal fees.
Otherwise If you switch make sure you add up all the legal and product fees and deduct them from the interest savings so you can determine the net benefit and whether it's enough to justify the hassle.
Having the tracker with Santander may be an option until we move. As we will be upping the loan amount when we buy, and want to get the best deal. I think paying a fee just for a product that may last 9 months is a bad option, but will work out the savings versus fee cost.
Cheers for all the advice so far! Remortgaging is a minefield.
We've come out of fixed rate deals early, paid the early redemption penalty, and been better off after a few months on the new deal.
Also although you're planning to move June/July time there's no guarantee that you will sell and buy somewhere which won't take a further 6 months to complete.
I'd calculate the cost of taking the fixed mortgage plus early redemption fees against being on a tracker and you should be able to work out which is best. There will probably be a sliding scale of redemption fees so the longer it takes you to move the cheaper it will be to pay it off early.