Your next mortgage

I’m in the last year of a 5yr fixed rate , and will have 9 years left on my mortgage at that point.
I will probably be in a position to pay off what’s left on it a year later (Dec 2022).
Can’t find a 1 year deal anywhere and will probably have to drop onto the SVR for a year as I’m looking at about 4K in early repayment fees if I take out a 2 yr fixed rate and pay it off early.
Going onto the SVR will probably increase my monthly payments by about £100 a month.
Does anyone have any other suggestions or best way to proceed ?
2 year tracker.
 


I’m in the last year of a 5yr fixed rate , and will have 9 years left on my mortgage at that point.
I will probably be in a position to pay off what’s left on it a year later (Dec 2022).
Can’t find a 1 year deal anywhere and will probably have to drop onto the SVR for a year as I’m looking at about 4K in early repayment fees if I take out a 2 yr fixed rate and pay it off early.
Going onto the SVR will probably increase my monthly payments by about £100 a month.
Does anyone have any other suggestions or best way to proceed ?

A bank loan to pay off the mortgage rather than another mortgage?
 
Those advocating paying it off or a bank load rather than a short mortgage extension, why? I was always under the impression it’s good to keep a very small mortgage ticking over. Means if you wanted to lend money it’s the cheapest way to do so and the credit facility is effectively already open.
I recently bought a new car and I extended my mortgage to do it as the interest rate and over payments Id pay on my mortgage was way less than car repayments over the same time.
 
Those advocating paying it off or a bank load rather than a short mortgage extension, why? I was always under the impression it’s good to keep a very small mortgage ticking over. Means if you wanted to lend money it’s the cheapest way to do so and the credit facility is effectively already open.
I recently bought a new car and I extended my mortgage to do it as the interest rate and over payments Id pay on my mortgage was way less than car repayments over the same time.

What did you give as reason for the mortgage extension ? It is cheaper lending but secured on your home so riskier too
 
Those advocating paying it off or a bank load rather than a short mortgage extension, why? I was always under the impression it’s good to keep a very small mortgage ticking over. Means if you wanted to lend money it’s the cheapest way to do so and the credit facility is effectively already open.
I recently bought a new car and I extended my mortgage to do it as the interest rate and over payments Id pay on my mortgage was way less than car repayments over the same time.
So a mortgage is cheaper because it’s secured on assets (your house) and therefore less risky to the bank. That’s why the interest rate is lower. It means that if you don’t pay it back, they can take your house off you.

A car loan is usually unsecured. Mainly because a car isn’t worth that much second hand so it’s not worth the bank repossessing your car to try and get their money back - it won’t cover it. So the risk is higher to the bank, hence why the interest rate is higher. If you stopped paying it back, they can’t repossess any of your assets to get their money back.

Also do be careful when adding to your mortgage like that.Because a mortgage is usually much longer term than a personal/car loan, you’ll probably end up paying more back over the period anyway. You’re effectively taking out equity from your house to buy a car - which isn’t bad in itself, just be aware where the money is coming from and how much it’s costing you in the long run.
 
Those advocating paying it off or a bank load rather than a short mortgage extension, why? I was always under the impression it’s good to keep a very small mortgage ticking over. Means if you wanted to lend money it’s the cheapest way to do so and the credit facility is effectively already open.
I recently bought a new car and I extended my mortgage to do it as the interest rate and over payments Id pay on my mortgage was way less than car repayments over the same time.
Have you done the maths? Like if you took the car loan over 4 years versus extending the mortgage for say 25y. I suspect you'll end up paying more without doing the calcs.
 
Ah mortgage.. I remember when I had one of those. ;)

I've had one and paid it off already... :D
Unfortunately, I now have another, and it is significant. First world problems and all that!


I’ve just read that back & I sound arsey! Not meant to come across like the @Keawyeds :lol:

It's all good! Decent thread for anyone pondering what to do
As it happens, we're going to go with the 2 year fixed as recommended.
There would be no real benefit of going for the 5, or the 3 really. It just ties us down for another year and should we decide to do something like pay a chunk off (assuming we have one) we'd be stuck for longer
 
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Yes they’re called Flexx fixed and usually available up to 75% loan to value. Used them a lot for clients over the years.
Usually very slightly more expensive than the best 2 year fixed rates on the market, but a godsend for people looking to move in the near future.
That's surprising
Leeds Building Society did one for a time per-Covid, but it had large fees.

I always found it strange Coventry don’t really shout about the products much, but they’re a massive USP.
 
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