Switch vs. Overpayment

Ciaran6410

Registered User
Messages
13
Hi all,

I am 6 years into a 35 year mortgage but due to monthly and lump sum overpayments this is reduced to 20 years. I am planning on reducing this to at least 15 years by another upcoming lump sum payment.

If we switch to another lender on a fixed rate am I reducing the term, our options and flexibility? As it stands we could potentially take a mortgage holiday if I was out of work etc.

Would it be a smarter option to remain with our current lender, maintain the term and change from the current interest rate of 3.15% to the <=50% LTV rate of 2.75%? This would also potentially allow me to make more regular overpayments greater than 10% if I was in a position to do so,

Look forward to hearing your thoughts
 
KBC looks a good alternative at 2.25% but can only overpay 10% per year
KBC is 10% of the fixed amount, during the entire fixed period can be repaid without a break fee. Not per annum.

Ulster Bank is 10% per annum.

Legally you can overpay as much as you like with any of them, but could incur a break fee in the amount you overpay (in excess of the 10%). If you shorten the term, you're contractually tying yourself to that overpayment.

Personally, I'd immediately switch to the <50% LTV rate and save 0.4% while you're working out what to do longer term. That's pretty quick, where switching could take a few months.
 
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