Well it's been a nice run on this rate - at 1.79% for over a year followed by 1.54% for over a year (and still).

Obviously, I'm glad I didn't switch toe the 2.19% rate referred to above but I've booked an appointment to move to the current fee-free 1.84% 5 year fix. After today's MPC meeting and the subsequent news, I don't think 1.84% will be available much longer.

Anyone tempted by their fee-free 5-year fixed rate that dropped to 2.19% this week? Or are you all sticking with the 1.79% tracker?

0.4% seems a small premium to pay for a 5-year fix.

Yeah, the intention would obviously be to switch rates after the fixed period so the risk isn't really concerning SVR rates - it's more to do with the margin over BOE available in 2 years time.

If the margin over BOE is 1.29% (the same as my current product) or less, I win by securing the fix today. If the margin is higher and/or 2-year fixed rates aren't available at the same margin I lose out.

Likewise, products could be available at 1.29% over base, but with high product fees - meaning that, if the fees exceed the savings made over the next two years, I lose out.

It's all a gamble but my thoughts are that margins will be less than 1.29% when the BOE rate is higher - and I can afford to be wrong as my mortgage isn't excessive.

Just bear in mind the standard variable rate after the 2 years fixed period which tends to be quite steep after the initial attractive rate. I almost signed up for the 1.99% fix for 2 years but then changed my mind to settle in for the lifetime tracker. It also provides the flexibility to sell the house and pay the mortgage in full which you cant do with fix rate mortgages but that depends on the options you are considering.

I'm still mighty tempted by the 2-year fix at 1.49%.

Traditionally, a fixed rate should be higher due to the fact that it's considered insurance against rate rises - especially now with rates at an all time low.

Sure, they could drop another 0.25% - but they could also rise by 1%+ over the next 2 years and, even in dropping by 0.25%, the fixed rate would still be cheaper than the 1.79% tracker.

Many Thanks - spoke with the advisor and was confirmed I will still get then 1.79% rate, yipeeeee!

Shame I didn't see this earlier....

I think you will find they will honour it. I got called last week and was given an appointment for today. I specifically asked what happens next week if you don't offer this deal anymore and he told me they would honour it because it wasnt my fault I had to wait for a week for the appointment. Got called today and they will be sending me the offer documents in the next few days.

Also consider the allowable overpayment on a tracker it's usually unlimited.
Fixed rates tend to allow only 10% pa

It looks like the 1.79% interest deal has now ended. The next closest is 1.99% for existing customers, I have my call with the mortgage advisor tomorrow but I dont think I will now be able to switch to 1.79% when the rates have changed as of today. :-(

I don't like the idea of fix. With tracker mortgage if First Direct comes up with even lower offer it's just a matter of 10min phone call to get that new rate. With fixed rate there are exit fees if you need to switch. You would also need to renegotiate after your fixed term ends as SVR is intolerable.

First Direct are unlimited overpayments on all fixed rate mortgages - early repayment charges only come into play if you pay the mortgage off IN FULL before the end of term.

Seem like really good fixed rates. Not sure if I will switch though as the SVR is something like 3.69%.

Is anyone that switched to this tempted by their new fixes this morning, which are fee-free for existing customers:

2-year: 1.49%
3-year: 1.89%
5-year: 2.29%

Thanks to all who helped. I spoke to First Direct today and the 1.79% Mortgage offer documents are on the way. The whole process was pretty painless, except sending them passport photocopies counter-signed by a professional for ID purposes. Everything else just went so smoothly. I have moved from HSBC's 2.29% tracker to First Direct's 1.79% tracker (saving of 0.6%) and plus moved my HSBC bank account to First Direct and gained £ 125 in the process.

This is probably the most substantial deal I have ever bagged on HUKD

It follows similar logic but a new mortgage would usually take longer to process. For example, a remortgage takes 6-8 weeks. The person is already in the property so a lot of the steps involved in securing a new mortgage aren't required.

If a new mortgage was going to take, for example, 12 weeks, you'd be taking a gamble that the rates are going to be the same in 3 months time.

Has anyone done the work around on a new mortgage?

this is correct I have called FD two days after switching. waiting for a call from them on Monday to change the rate.

You'll need to speak to someone (not online) and you can arrange the appointment to speak to someone as soon as the switch is complete. No need to wait for the first payment.

To those who have benefitted by moving to First Direct at 2.19% and then opted for 1.79%, I need a bit of guidance.

The completion date set for my mortgage @ 2.19% is imminent. When (at what stage), I become eligible for the 1.79%? Is it after first mortgage payment or when my Mortgage account gets set up?

Is applying online for 1.79% better than having to speak to someone at First Direct for this change?

Its still available find the details through the below link

www3.firstdirect.com/ass…pdf

It's still available.
I've just been on the website, and I can still see the BR + 1.29% tracker for 65% LTV.

I think this has now ended and has risen to 1.49% - can anyone else confirm?

So my remortgage completed on the 5th March, so about 5 weeks total, and that was returning stuff within a day or two. I was on holiday at the time and just called them now to change to the 1.79% rate and there didn't seem to be any problem doing that immediately, but they needed to schedule a special rate-change call (even as execution-only) and the earliest they have to do that is the 26th March!

it would definitely work for mortgages that have interested calculated daily, in the past some mortgage companies (abbey national) calculated the interest payments based on a yearly calculation, thus overpayments didn't make a difference, not sure if this practise continues

I've been hearing talk recently that it works out cheaper in the paying a mortgage weekly than monthly - has anyone looked into this with FD?

I had 4 years left of a 5 year FD fix, £3k exit fee but at 1.79% our mortgage has reduced by £260 per month. It's a risk...

Sign up for the 2.19% tracker (no fee) and when It goes through, convert over free of charge, (hopefully still available when You get it

Mines all done, huge fee to pay but risking that rates won't rise for a while yet!

Thanks OP for saving me some cash.

Got my call last night (an hour late) but switched in 5 minutes to more than 0.5% less than my current rate. All quick and easy, same term and everything as before just a bit less per month and now no closure fees at the end. Money saved will go straight into overpayments.

Actually the worst that could happen is I end up staying on 2.29% with HSBC.

I figured the worst that could happen is they phone up and say I have to have the 2.19% rate.

OK for those of you taking the 2.19% and hoping to switch this may help.

I put in my application for the 2.19% on Sunday. However, I made an error and was called and told to amend my mortgage term so that it was paid before I retire, no problem.

I have gone on the website, clicked amend an application, and it is showing the 1.79% NO FEES mortgage as available on my list of options. I am not a current FD customer and I have checked that box. My KFI confirms all the details no fees etc. Saved. Process my application, make the declaration, done.

I am not a FD mortgage holder so should not get this fee free (£950). But hey I figured worth a go! Just hope it comes off and they honour the KFI

Exactly what am I doing. Let's hope it will go down even more, by the time I get to 2.19%

Agreed take the 2.19% mortgage once confirmed swap to the 1.79%

I would disagree. you have to be their mortgage customer to get this rate, otherwise £950 fee. the OP is correct, I am just waiting for the paperwork from them

Spoke to them today following our valuation, they couldn't confirm the full details as it is a different department but the valuer has agreed with our 250k valuation allowing us to move onto the 65% tracker :smile:

Yes, that helps you avoid the fee, otherwise you need to pay the £950 fee.

okay, so I need some advice

I have opened a Firstdirect account. Can I now be eligible for the 1.29%+0.5% = 17.79% rate? Or do I have to go for 2.19% and once on it, contact them again to move to 1.79%?

Should I be discussing 1.79% with the mortgage advisor? I have a call with them next week

Do First Direct have strict lending criteria like HSBC?

We are on HSBC "1.49%+base" lifetime tracker - getting the mortgage was a total nightmare process from start to finish and that was before the MMR.

I am tempted by this, but if their lending criteria is anything like HSBC, chances are I will be rejected after going through the full application.

Possible further BoE Base Rate cuts!

Looks like potential good news for tracker mortgage holders!

Local market is the key, there are so few houses for sale and being a commuter town for London keeps forcing the price up - When we bought houses had full asking price within 48 hours! Currently five 3 beds advertised for sale, all on the market since Mid Jan all between £240-250k.

The house next door to the one we nearly bought is on at £250k, the house next door sold for 170k in May 2013.

It's a crazy market, I'm just glad we got in when we did.

@masekwm I presume FD value houses the same as hsbc, if you recently purchased the house for £180k then clearly they will not hike up the value to £250k, without a revaluation were they can see and talk to the owner about what value they have created, has the local market increased significantly (38%) in less than 18 months, have you made significant lump sum payments lowering the LTV to original purchase value.

Affordability is also key to mortgage providers with new rules coming in the last few years

I had a bit of a nightmare, tried to exit my fix to go on this, first call was fine.

Second call - Execution Advisor then pointed out adding the fee triggered a new application.

Third person wouldn't listen to me, I even said to him can't I just pay the fee? No, new application. Went through the call, we can lend you 50k less than you require, I think I spend too much on something? Would you like to speak to an advisor? Said yes after asking him "can he offer more?" "I can't say". That'll take an hour call!

Complained, that I'd have to wait until the 21st for a call back, so they called next day. Fourth guy calls yesterday. I cut him off before he asks how much I spend on bread and go go girls, can I just pay the fee and move to the new rate? Yes! You'll need to speak to someone else though.

Fifth guy calls last night, new rate secured but they value the house under what I hope it is worth, so need to send a valuer out.

I've no idea how much our home is worth, our offer was accepted in May 2013 at 180k, we completed in November 2013. There are no 3 bed houses for sale in this town (1.5 miles wide) for sale for under 240k, but we have a loft conversion making us a 4 bed. Hoping they'll agree 250k over computer generated 230k

what you on about mate.....it's right there

awesome, thanks. I'd seen that and thought for some reason it was the 1.79% plus base, not 1.79% all in. Much better than my 1.89% + Base them.

Nope, it's still there....

link

I can only find 1.79% + base. The 1.29% + base must have expire, darn!

There's no catch. Just ring and ask to be swtiched. They'll probably arrange a short phone call and, depending on how busy they are, this may not be scheduled for a week or two.

I currently have this at a 1.89% rate, wonder if there is a catch or if I can really just switch for free.

With the amount of great 10 year fixes going around too, does this indicate that banks aren't expecting massive rises? All I've read is talk of another bigger recession.

I'm not a fan of fixing though, a tracker like this is always going to be better in the long term. Fix you just get security for a few years but then a much higher rate after than what you would have if you got the tracker.

Same here! Had my call yesterday, 10 mins and job done, paperwork in the post. No fees/no valuation required. Have requested to keep my repayments the same though, on a 6 year mortgage, I think I can shave off a couple of months!

ERL's were always a minimum £10000. Unless that's changed in the last 5 years or so. You could sign for and borrow 10k, but, only drawdown 5K? Or just pay back 5k immediately?

Nice one, I'm in the exact same position and just waiting for the callback.

No fee/charges to pay at all.

I currently have a FD tracker mortgage at a higher rate and just wanted the cheaper rate.
Term and borrowing remain the same.

Uzu just checking that you didn't have to pay the £950 fee for this did you?

I know the answer is in the title but there's been a couple of confusing posts :smile:

As I suspected, 5 and 10 year fixes have dropped with first direct today.

The 5 year fix with no fee has dropped by 0.2% to 2.59%.

The 10 year fix is now 2.84% with a £950 fee.

The trouble with fixes is the SVR rate you will have to go on when complete, ie 3.5% on top of base, I.m gonna weather the storm on my tracker for life hopefully

True.

5 and 10 year fixed rates have been dropping across all banks this year to a point where First Direct are no longer the most competitive on the market - especially considering the bank has a reputation for stricter lending criteria compared to the likes of Nationwide.

I do, however, expect First Direct to announce a drop in some of their fixed rates with the next fortnight or so. As we are currenlty on lifetime trackers, we'll be free to switch if we feel the new rates offer good value. :smile:

I would have considered fixing at that rate if it was at least 5 years.
To be possibly paying remortgage fees in a couple of years time to get a good rate didn't seem worth it to me as it may suck up the savings already made.

I can't decide (very tempted). I'm currently with HSBC lifetime tracker (2.19%+0.5% base rate), 135k mortgage. Not sure if I should wait or go for this. Phoned HSBC and they said the best they can offer 1.49% tracker + 0.5% base rate, but wanted £999 fee.

I returned my paperwork and was put on the 1.79% rate on Tuesday. Were you tempted by their 1.59% 2-year fixed rate with no fees at all?

Just had my phone call this morning.
It was 'execution only' as I was just swapping from my BR + 2.39% FD tracker.
The call lasted 8 minutes in total, and 2 minutes of that was just answering security questions.
I'm just waiting for the paperwork to arrive, so that we can sign and return it.

Great deal if it suits your circumstances and you can get it.

It turns out my mortgage is actually with HSBC not 1st direct. i recently re mortgaged with HSBC in April 2014 however would like to extend my mortgage by another £5000 because the home improvements have cost a bit more than expected. HSBC have stated i need to borrow a minimum of £10,000 so i might re mortgage again with 1st direct. Is this good practice and would it affect my credit score or anything else? My LTV is 43% and our joint income we can easily afford the repayments.

It's 1.29% + Base Rate - currently 1.79%

I cant see the 1.29% rate on the First direct website. Do i need to ring them? I'm an existing First Direct mortgage holder.

When I posted that I thought I was joking!!1!

dr.dk/Nyh…htm

Google translate:

For the first time a Danish mortgage bank, Nordea Kredit, issued a mortgage with a negative interest rate, Jyllands-Posten's corporate site Finans.dk Friday. This means that Nordea Kredit this week have had to pay interest back instead of charging them to a handful of customers, says housing economist at Nordea Kredit, Lise Nytoft Bergmann for Finance.

The interest rate has balanced around 0 in a level between minus 0.03 percent plus 0.03 percent. Most have paid a modest positive interest rate, but there are so few who have had a negative rate. It is quite an unusual situation, says Lise Nytoft Bergmann.

They tried to hard sell two year fixed rates which are actually lower. I can see one obvious fault in those. If FD has a campaign for even lower rate I can always give the 10 minute call and decrease my rate for the rest of the mortgage term. For 2 year fixed rate it's not really possible or so cost effective.

Okay. The first guy I talked with didn't really give me any other choice. May be I should have insisted. Anyway, just mailed the application and I'm on my way to lower rates :smile:

That is if you take the advised option - if you know the exact product you want it's "execution only" and they are literally only interested that you can afford it. Setting up my current account was 15-20 minutes on the phone, then the call about the mortgage was 10 minutes.

I'm changing FD mortgage product from off set to this repayment mortgage and it's a lot of talking. First you have 30min initial talk and then 90 talk with the mortgage advisor. Anyway it's now sorted and papers should be coming in mail. I took the off set mortgage 6 months ago so luckily no need for another evaluation.

I have just been accepted in principle, and they said there wasn't any valuation fee for my circumstances (desktop in-house valuation check I imagine). I'm not sure why, possibly it's either because I am an HSBC mortgage customer, or the LTV is well within the limit.

I applied online and the phone call was 10 mintes, although I had already applied and set up the current account which he said cut a huge amount of time.

I've just had my phone call (the one that there's a 2 week wait for due to First Directs current workload).

It's very straightforward - they just confirm whether you want to change anything, other than the rate, on the mortgage and whether your personal circumstances have changed, e.g. employment.

They'll be sending out an offer document in the next couple of days to be signed and returned.

That's strange. I had no valuation fee to pay.

I have applied, since even with the hassle it will still save 0.2% even on the fee-free option (which I have selected). My mortgage is small enough that the £950 would take a long time, and it's worth a

Important thing - there are no product fees but there is a valuation fee (scaled by property value), I assume this is for new customers only. Annoying in that I'm mortgaged with the HSBC group already, but the savings will pay it off in a year or so, even at the 2.19% rate.

Comment

thanks for that. I can relax then!

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They book a 30 min slot but no affordability checks only processing of change of rate. 15 mins tops from start to Finish.


As for holding the rate for 6 months, for this to happen you must return your offers within 1 month of issue. Don't get caught out by that.

I.d seriously consider taking a loan, preferably 0% balance/bank transfer from a credit card (3% fee) or use an overdraft assuming it's only a couple of grand ..

All depending on the money you will save of course

So I'm on HSBC's base +1.89% mortgage (2.39%), for some reason I thought I was on 2.19% until I just checked.

So therefore I can't see any downside to switching to FD's 2.19% deal, I'd save money instantly even if the lower rate is pulled. If it's not then I am definitely up!

I just checked the basics, and the terms are the same as HSBC's lifetime tracker (it's probably the same product but with different rates/fees), ie. you can port or repay or overpay with no penalties.

Our LTV is 66% at present, we'd be about three or four months away from getting under the 65% threshold for this deal I reckon. Does anyone know if they are flexible on this kind of thing, or if there's a limited availability period for this particular mortgage?

I've Stopped bothering to look, rates aren't going up anytime soon ..
It'll be all over the news if the votes change again
Was very happy in 2011 when the muppet who voted for rate rises handed in his notice

I work for a bank and late last year the consensus was q4 2015 for .25 or .50 rate rise. Now revised to sometime 2016. That was before the 2 committee members changed tack. FYI anyone can sign up to BoE newsletter that gives instant notification of results of committee rate change decisions (and minutes) so you get some context too

Exact same situation for me.

Cheers OP!
I have 3 tracker mortgages with FD, 2 @ 1.89% obr and 1 @ 2.99% obr
Called them to see if I could switch to this rate - CSR first of all couldn't find the rate? But, after putting me on hold came back and said yes, it is available.
I have had to book a 30 mins telephone appointment in just over a weeks time (1st one available!) I said I was concerned the rate wouldn't be available then, but I've been assured that the rate has been 'marked' on my records and will be available for me.
I was hoping this would be quick and easy but sounds like they still want to go through all the affordabiity checks even though I've banked with them for 20 years, and this deal will end up saving me money!

Loan to Value

ie a percentage of loan to house value
example £100k valued house (current market value)
mortgage remaining £75k,
you would have a 75% LTV
For the best rates you in effect need to own 35%+ of a houses value, as you are less risk to the bank..
ie if you default and the bank need to sell, they will recover their own money (first)..
ie they sell the ouse at 65% market value for a quick sale, you end up with nothing..

Loan To Value

i.e the amount of money you want to borrow compared to what your property is worth.

Newb here. What does LTV stand for?

Not at all. It's FEE FREE for existing customers, else there is a £950 arrangement fee. It is open to all who make the criteria as far as I can tell.

Oops I'm not an existing First Direct so guess I'm outta luck!

Well I'm currently on Halifax SVR and not tied into any mortgage deal so free to switch. Pondering this deal. LTV on my house is about 60%.

Is it a big faff. I,m with hsbc and as long as your LTV is inline it's a 10-15 min conversation and a few letters to sign by joint partners..
I.d have expected much similiar from FD

I've only just updated my mortgage with them a couple of months ago. I'm guessing that I would have to go through all the faff again if I wanted to just switch deals, rather than just phoning up and moving from my existing tracker to this one?

I'm on FD offset tracker 2.49% + BR and now changing to this product. This will save me quite a lot of money. Got through the initial questionaire and got a telephone appointment for next Wednesday for the actual application.

thanks

Absolutely agree... I'll be waiting to get a bargain, there should be a nice drop in house prices if and when interest rates go up. :wink:


I agree with your analysis. And conversely I believe that any payrise will be sucked up by interest rate hikes if you have borrowed a lot of money:
widespread payrises => economy does well => interest rate hike => payrise gets (partially) eaten up by increased mortgage

Obviously payrises also depend on personal performance. I'm watching from the sidelines curious to see if/how things unfold.

Rates are going nowhere, inflation is at risk of going negative so payrises are going to be harder.

When comparing trackers to fixed that have higher rates you have to factor in the overpayments on the tracker and renewal fees.
Rates have to go up more than just the difference to be worse off.

Low cost trackers or long term fixed, 5 years is not long term, 10+ is worth a punt if there is one at a decent rate like 3% and you won't need to move.

The latter offset is fee free and a lower rate than your current one so you might as well change to that one if nothing else

Daily express front page headlines "base rates hold for 2 years"
Usually a few of the muppets vote for a rise whatever the weather.. They finally realised this fragile economy cannot handle a rate rise..

oh really?

Is the deal only for repayment mortgage or also offset? Currently on the offset 2.29%+BoE....

Interesting that reuters have just said that the two BOE policy setters who were pushing for an immediate rate rise have now dropped this due to the ECB bond buying program- looks like rate rise may thus come later.

The best thing about a deal like this is that you can move quickly if the mkts change and get a long term fix without really losing much so it gives u flexibility. Key is to keep track on how the vote setters are voting and how things like the libor rate move

I'm going for it. I'm currently on their 2.29 tracker, so cannot lose really. Very busy though. Their mortgage advisor cannot ring me to work through the application until 7th Feb. although they will honour the interest rate against the current deal.

Thanks and have some heat.

I have just spoken with FD on the phone, and they advised me that you can secure a new deal up to 6 months in advance of when your current fixed term FD mortgage ends. As there is no booking fee for this deal, you could secure it 6 months before you need it, but lose nothing if you cancel in the interim.

I recently (just before Christmas) switched from HSBC SVR to a HSBC 75% LTV Lifetime Tracker. I was quite a bit short of the 75% LTV, but I'd done quite a bit of work on my house since I bought it so the loan value didn't reflect what it was really worth so I asked them to revalue it. I had to tell them what I believed it to be worth, paid them £180ish for a valuation, and they sent a surveyor round to see if he agreed with my valuation. I was told by the survey he'd need to find three similar properties within a certain radius that had sold for around that amount to tell HSBC he agreed with the valuation. I'd assume First Direct;s procedure is the same.

FYI If you have a HSBC current account the fees are less. It was half but not sure that's still the case. I have a dormant HSBC current account and still got the discount.

Hope that helps.

Hot, I think my Yorkshire Bank tracker is the same rate, currently in credit but with a big spend ahead it's nice to know that I'll be paying peanuts on my "borrowing" when I go back into debt on it.

This is a no brainer for those already on a lifetime tracker with first direct at a higher rate... for the sake of a phone call you might as well move to the better rate as it won't cost you anything (no fees).... you still have the option to go to a fixed rate mortgage at some point if that's what you want to do as there are no exit fees

I'm on a lifetime tracker with HSBC and like others have said I'm hoping they'll match this offer at some point so that I can move to a slightly better rate without having to pay fees

I can't see this mentioned already, but I thought it useful to point out that First Direct are also offering 1.49% + base rate, which is currently 1.99%, on a 75% LTV. For some people early in their mortgage, it may require a significant lump sum investment to achieve 65% LTV, therefore this alternative may be a good option even though it is a higher rate than the OP of 1.79%.

My FD fixed term runs until later in the year... I hope these sort of rates are still available then!!!

house price is just going to keep rising.

Higher higher higher....

I just moved onto this from another tracker with First Direct (so as an existing customer). There were NO fees, no house visit, just a telephone questionnaire which took 10 mins. Paper work sent, signed and returned. Zero pain and a big gain. Rates aside, FD are really excellent and speak English as a first language.

Agreed... you need to be happy staying on the initial product you apply for if this rate is no longer available, i.e. stay on the 2.19% rate. The alternative is to avoid taking the risk and stump up your £950 fee.

In answer to someone else's question - £149 closure fee.

As for workaround - it's a 6-8 week timescale to drawdown. Good luck any of the existing rates still being available.

Yes, speak to an IFA - seriously. Absolutely no one should make any kind of financial decision based on advice from an essentially anonymous, public forum.

From FD website:

"Closure fee
This is an administration cost to cover the costs in closing a mortgage once it has been fully repaid. Where a customer wishes to transfer their rate to another property and the sale and purchase complete simultaneously, the closure fee will be waived."

Any ideas how much that would be?

I hope HSBC, as part of the same group, think about matching this. Good deal.

Any chance they would take part of my mortgage (16,500) and I could leave the bulk with my existing rate of 1% over base rate with Chelsea?

on trackers fix the mortgage at 30 years, to get the lowest possible monthly capital repayment,
trackers are ideal for those with the intention of overpaying mortgages..
if you are stretching to pay the current rate, then quite literally you are ****** when the rates go up, in 5 , 10 , 15 years time..

if your smart you'll have paid off the significant chunk off your mortgage by the time rates rise.
although many factors for and against

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No, you're a HSBC customer, not a First Direct customer

I know but where is the incentive to retain customers and business? (particularly as the IO period is different from the repayment part of my mortgage). Overall I have found HSBC hard to do business with staff initially not being able to help unless you go into a branch to discuss, it then took 4 further calls to get an accurate position although today I found the website stating they would knock £500 fees for some products. Last night they did find an email stating they would extend another year if they had proof I was selling which is illogical. Hopefully FD processes are different to HSBC.

I'm currently on a lifetime tracker with HSBC.. Do I count as a first direct customer to get this fee free?

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Just bouncing ideas around of course I will see my IFA before changing.This is a discussion board after all.

Can anyone confirm the workaround will work for this?

I applied for my mortgage with FD 6 months prior to my Nationwide 2yr fix ending, if you're looking to lock in rates at these levels I would suggest you do the same

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You would get it fee free. Consider what benefit you actually get per month from having an offset. You would need to speak to a mortgage advisor because you are changing product so they will ensure you get the right product.

Hi all. Have a fixed rate currently and will be looking to move to something like this pending interest rates when the redemption ends on august 31st(around £1000) . Am I right in saying that I should start looking at the end of June for a new mortgage and also is it worth me overpaying on a the fix i have now or waiting until it ends and putting a deposit down before the new mortgage?

This is a good deal but it isn't a deal for everyone. It certainly isn't "better than fixing" for many people in certain circumstances. I'm sure the OP posted in good faith but you should always seek independent advice or do your own research.

People have a short memory and I do wonder what half the population would do if the oil price shot up again, we had rampant inflation and the pound started falling. Interest rates would rise and the trackers wouldn't seem anywhere near as good as the long term fixed.

Fixing is always a calculated risk but so is going for a tracker. It should be based on personal circumstances and appetite for risk!

For the record I'm not an IFA but I am financially astute and I am on a First Direct Lifetime Tracker at 0.75% above base. Its done me very nicely and FD are a fantastic company.

Actually mathematically impossible unless your interest rate is already below 0.25%

Thanks OP. I currently have an Offset mortgage with First Direct and am currently paying BR + 2.39% and have been overpaying every month since I took it out about 4 1/2 years ago due to the low rate and this has substantially reduced the outstanding capital. The best Offset one they have available at present is BR + 2.29% so may give them a call.

Thanks again OP.

I think if you are doing a sensitivity analysis on future interest rate changes it would be very sensible to do it with a base rate of 1%, 2%, 3% and 4%.

Please do not get complacent that interest rates only ever move in 1/4 points. That is a relatively recent thing........predicting interest rates is a dangerous game but making sure you can afford a mortgage with a base rate of 4% is very sensible for the future which on this deal would be 5.29%.

Tempting . I'm currently on nationwide 0.5% BR + 2% (2.5%) so free to change and make any over payments I like but planning to move house this year so will no doubt end up borrowing a bit more .Currently have a LTV of about 30% so most deals should be available to me any thoughts?
Thanks

I suggest double checking the numbers you are putting in. Surely that equates to an existing interest only mortage rate of around 0.25% and an even lower rate for a repayment mortgage, which seems rather unlikely.

The talk that rates will rise in October has now gone away - the BoE are now unanimous on holding rates, which suggests that rates aren't going anywhere any time soon.

Good advice to run the numbers with different interest rates though - there is little point stretching to afford a mortgage now if you can't afford it with even just a half-point rate rise in 2016.

Investment rates can go below zero! For example Swiss government bonds are now negative up to the 14 year mark. Wish I had mortgage with negative interest i.e they pay you for kindly looking after their money.

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Short answer - it depends what it's valued at. This tracker deal (for non existing customers) would require you to pay the fee to revalue it. If you are existing it would be done for free.

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Mortgage balanced divided by your property value x 100.

hot

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Sorry, I see you pointed that out in a later post

What?!

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The 2 year fix in the same bracket is actually 0.2% cheaper. It is a product that I was also highly tempted with.

My 2 pennies worth, and definitely echo the IFA comments prior:
FD mortgage customer here on a 5y fixed at 2.59% with ~4yrs remaining.
I can only say good things for FD as a current account holder of 10yrs plus, and their mortgage team are also extremely competent.
This is tempting, even though I feel my deal is still "in the money".

For me, the upside of 1.5-3yrs of lesser base rates will probably net out against what I'll save from year 3 onwards on my current deal. But for anyone on not such a good current deal I think this looks a pretty good deal. One word of advice would be to put the money saved monthly a) away for a rainy day, or b) overpay against the mortgage. As and when we do start to hike rates, you will want to safeguard yourself against higher monthly repayments with less capital borrowed.

We're about to do our first remortgage after our 2 year fix is due to end in August (bought our first house in August 2013) and have done considerable renovation to our house in the meantime. Our house will be worth a fair bit more than we paid. I'm presuming we'd need to have it revalued. Would this be done by the lender? As if its at the top end of what we think it could be worth we would be inside 65% ltv and we'd like to get onto a better rate than the 3.89% we're currently on. Thanks

When I re-mortgaged to HSBC Tracker Mtg they didn't even come out and value the house. They use an online system such as zoopla/mouseprice.

Stupid question but how do I work out my ltv?

Many thanks for this info, I am on a 2% lifetime tracker and my provider has a loyalty scheme to match and then beat other providers plus as a fall back I also bank with FD :smile:

The 2 year fixed is actually lower at 1.59.

Please all - do a quote at the advertised rate and another quote adding a quarter and then half to reflect a rate increase. There is talk that rates will increase in Oct this year and if they do, my tracker mortgage repayment will double with just a quarter point raise!!!!

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Survey will dependant on your ltv. Legal fees are not chargeable usually as dealt with as part of deal.

I looked at Coventry but decided that I'm completely against them due to them not being actual BOE trackers. They can change the rate on a whim. I know you are free to move without penalty - but circumstances could change before a person would want to move resulting in them being unable to remortgage.

For example, they could have lost their job or moved to a lower paid job. Partners could now be stay at home parents. Bank lending criteria could be further restricted. They could have accidently missed a payment on a credit card. Significant expenses could have resulted in them needing a personal loan which reduces the amount a bank is willing to approve on a remortgage significantly. The list goes on.

Few points - the workaround potentially will work but no guarantee the rates or the existing customers offers will still be there. Existing customer = mortgage customer, excluding purchases and certain other scenarios.
It is a life time tracker, but bear in mind that the 2 year fixed in the same bracket is the same price. Your ability to cope with rises coupled with your opinion on when rates will increase will determine whether to fix or track.

Oh an don't worry about misinformation - first direct pay me to get this right.

Why would/should HSBC extend it? Surely there was a set time on the original deal that you agreed to?

Sorry but feel the need to vote cold, being forced from interest only to repayment isn't great as I would rather make the capital repayment work better by using up my isa allowance or invest to earn more than the 1.79%. 1.89% for term is more easily available with the Coventry Building Society.

I also have a gripe with HSBC group in that they have told me I have 1 year on my 2.19%. On a small mortage I could stay but they won't extend term unless they force me onto a new product with high fees which must be repayment unless I'm a premier account holder (earn 100k/year).

This is forcing me out into the market place and I now favour Coventry Building Society, 1.89% for term (not tracker) and only £300 fees LTV upto 75%.There is even an offset at 1.99% for term. These are not trackers but you can leave at any time so don't see why the rate would not remain competitive which Coventry seem in many areas particularly B2L.

coventrybuildingsociety.co.uk/mor…spx

I am currently remortgaging a B2L through Coventry and everything is going very smoothly.

This is hot. Wish my erc wasn't so much or I would go for it. Any ideas what legal and survey etc costs would be involved. Also worried my house would be revalued and then I won't have a good LTV.

It's amazing how many people cannot read the initial comments, this offer is available as stated.

I.m on a hsbc tracker, if I could switch to the 1.29% with zero fee I.d do so instantly, been checking for a blue cross sale, but like you say first direct seem to be forerunning at present.

a few years ago I borrowed £7k to push me through the threshold LTV, and get the lower rate, did the transfer, rang the mortgage number and they switched it over, no problem. Think I had to pay a £100 fee, but recouped that in 3 months, Never looked back to be honest .. Can't see me ever fixing now.

Yawn, I.ve been reading this since the month after it dropped to its historic low in 2009.. We all know it's gonna go up, but as I,ve said

take out as lengthy a tracker as possible ie 30 years, remember if you take out a 15 year mortgage your capital repayment element will be double the amount per month (give or take)
With unlimited overpayments on life time trackers, pay what you can afford to pay,
Reduce your capital, thus improving your future mortgage offers (improved LTV) and reduce the interest payable on capital.

It's win win until base rates start moving and your circumstances change so it may be the right time to fix, ie wife has a baby and only one income,

With the base so low, rates will only be going in one direction and that's guaranteed. Just a question of when. I remember when ppl used to say the base could go up, as well as down. Not any more, its only going up.

So much misinformation in the comments of this thread :smile:

have you read the title, the header clearly states 65% LTV, it also states for existing first direct customers, If you already have a FD mortgage why would they need a re-valuation, new customers would likely have valuation fees

Ps LTV of 65% is £65k debt on a £100k house, ie you.ve paid off £35k and your house is still the same value

Existing customers do not get a free arrangement fee for this product, it also depends on the LTV which is how much you owe over how much your property is worth, this deal will likely require 65-75%, as it has an arrangement fee there will also likely be a valuation fee too.

What more choice do you need? This is a great rate. Over the past few years, HSBC and First Direct (part of the HSBC group) have been passing the baton between each other with regards to the best lifetime tracker rates. First Direct happens to have the best now.

A 1.29% margin is the lowest it's been in quite some time - and certainly the lowest it's been since the base rate dropped to 0.5%.

Yes agreed, You may strike lucky with a fix and save long term, but that is the extremist scenario, in general people fix mortgages over and over again, to fix a mortgage is paying a premium to protect against rate rises, whilst not being able to reduce the capital significantly,
All fixes transfer onto a SVR after the term, again these tend to be 3-4% above base rate, hence paying 0.8-1.5% on a tracker your better off..
But youmust be financially astute and not bury your head in the sand

Ps. I don't think I.d fancy a 10 year fix that has big early redemption penalties, transferability may be a problem, plus if your missus leaves you for buying too much crap on hukd and demands half the house then

Why are there so few lifetime tracker rates. This is hot. But wish there was some choice.

The great thing about First Direct is that you can take an offer such as this 1.79% tracker and, for your overpayments, sign up to their 6% regular saver (4.8% after tax). You can put anything up to £300 per month into this. You'll earn more interest in the savings account than you pay on the equivalent funds in the mortgage.

At the end of each year, do a lump-sum overpayment of the (up to) £3,600 plus interest and open a new regular saver for the next year :wink:

Been with First Direct for 20 years now, never had a problem with them. Will be ringing them about this offer.

Saying a good tracker beats a fix isn't quite right, if you are on a fix at say the nationwide rate for new customers of 2.84% for 10 years as soon as rates rise to 1.6% then tracker becomes worse. Imagine the rates of the 90s or even the 80s and you could get stuck badly. This is a good deal, always worth seeing how the markets predict rates will go, current fixed rates and experts point to low rates for years to come but don't just sit on your laurels and say because you have a tracker ypu are alright. You need to keep an eye on the rates and though we have had low rates for a long time history show they can go up as well. Oh and I am on a FD tracker lifetime at 0.79% above with no early repayment and at time no fees. Fingers crossed for 7 more years of low rates and ours is gone but will keep an eye on the rates as the years go by. Since moving to that rate in 2008 quartered our interest payments :smile:

When you put in your details select the option "existing mortgage customer" it's no fee upfront

I just called them and apparently existing customers have to pay the 950 too.

Where does it say no fee for existing customers? Can't you just sign up and take out the mortgage at the same time and hence avoid the fees?

It's a Life time tracker, ie tracks the base rate at 1.29% on top, ie base rate moves to 2% this will be 3.29%, but long term you.ll always beat a fix with a good tracker rate (no fees every time you need to fix again, and most fixes tend to be well above base rate

the clue is in the title:

'Life' Tracker Repayment

It is a lifetime tracker ie tied to the base rate, not a lifetime fixed at the rate shown above

where does it say its is for life this rate?