Hi ,

It is my first time on here ,

but was hoping someone would have wise words and sound advice for me,

my fixed rated morgage is coming to an end,

which means after years of paying out I will only owe £5000 on my morgage,

yes I know I'm the lucky one, but what would be the best thing to do with such a small morgage ,

would any company give me a morgage deal for said amount.

thankyou for reading, Elajane.

Hi,

Is your mortgage term coming to an end, or just the 'fixed' part of it?

In your current mortgage term is not coming to an end, you may be lucky enough to be going onto the standard variable rate, which may be lower than any available fixes or other deals.

If your term is coming to an end it is more difficult.

In general terms the lowest mortgage companies generally offer in a mortgage (rather than a loan) is £25,000, but you should be able to discuss this further with your mortgage lender.

Also if you are coming to the end there are other costs (fees) involved and not just the capital, so it is good to get a settlement figure from the bank to confirm how much it would actually cost to settle the debt.

I hope this helps.

Sparky.

PS I'm only an enthusiast, not a Financial professional.

Sparky,

Thank you that has helped,

It is my fixed rate that is coming to an end,

and I think I understand, that by it going to standard variable rate, I will not have to find the last £5000,

I will just continue paying monthly till it is finished ,

It sounds simple when you explained it .

Once again, thank you for repling .

Elajane.

Hi Elajane,

Your lender should send you out a letter to tell you that your interest rate will be changing and when (when your fixed rate period ends). You most likely then go onto the Lenders Standard Variable rate (or another specified rate in the deal) which will probably be between 2 and 3.5 %.

If you haven't received a letter or it doesn't tell you enough, feel free to ring them and ask them questions.

Now that you are coming from your fixed rate you should be paying less, but as you only have 5000 remaining you are towards the end of your mortgage where your payments contain mostly repayment and so it will not change massively.

E.g on 5000 at 5% you would be paying 250 annually in interest (about 21 per month) and the rest repayment

now at 3% this would only be 150 annually or 12.50 per month so only 7.50 difference per month.

The lender may reduce the amount or dependant on the remaining mortgage term it may continue to be fixed to repay.

Sparky

Sparky.

Once again thank you for your help.

One more question, ?

I pay £350 a month instead of about £275 , I started doing this to clear it faster,

I supose I will still be able to do this when my fix rate finishe's.

Elajane.

Hi Elajane,

It's a good idea however some mortgages restrict the amount that you can over pay to 10% a year, so it is worth checking with them. As you probably only have two years left on your mortgage I think you should be fine and you can probably pay off the amount at any time.

It's worth calling them to discuss how you will complete paying off your mortgage, and how much is required to do this, and to then sort out a payment plan. It may be a mixture between paying money to them as before plus paying some into a savings account to pay fees at the end. It is certainly possible in the next 2 years, or maybe quicker at the 350 a month rate! (about 16 months)

Sparky.

Sparky,

you have been a big help,

thank you so much.

Elajane.