Its a pleasure - let us know how you get on with the halifax

louise

Thanks very much. I will go back to Halifax in the first instance and if they don't come up with the goods then I'll try an IFA.

Cheers for your help!

 

Good morning

You are quite right that the relatively high application fees for most competitive mortgage products would outweigh the benefits on a smaller mortgage - but what a nice position to be in!

As you have discovered, Lenders do not encourage applications for smaller mortgages - simply not profitable - so many deals are only available on larger balances. My first recommendation is to go back to the Halifax. I know they have some very competitive 'retention' products for existing borrowers - and 7.2% does not seem to be one of them!

Although personal loans are advertised at 6.1% typical APR - they are priced for risk - and you may find that, because you need a relatively large amount for an 'unsecured loan' you will not be offered the lowest interest rate. I do think you are better staying with a mortgage, but working with Halifax to get a more competitive deal.

Failing that, take some advice - but make sure ALL fees are taken into consideration when deciding if it is worth remortgaging.

Louise

Something else to consider is an Offset mortgage.  But the advice above to speak to an IFA is the best option

One thing you could do is to borrow more than you need, on a flexible deal which you could then repay the amount you didn't need. Northern Rock, off the top of my head, allow overpayments up to -£100 balance, without charging the repayment penalty. I don't know what their minimum loan is but it should be easy to see on their website.

Can't see why any lender WOULD specialise in small mortgages - simply not in their interest (sorry, bad pun - and unintentional!) to do so!

Personally I would always recommend that you find a decent mortgage broking IFA to get your advice from, they can research the market on your behalf, and weigh up all elements of your situation.

HTH

Hi,

I wonder if you can help. My current mortgage with Halifax ( 5.69% interest) runs out at the end of this month. Since the outstanding balance is relatively small (30k) and I'm keen to pay it off as quickly as possible, I'm wondering what the best thing to do is. If I change lenders the fees all seem to outweigh the interest rate saving - plus most of them don't lend less that 30k. I also want something flexible with overpayment options and no early repayment charges (I'm coming into some money soon and hope to pay off the whole balance within a year/two years). Halifax have offered to switch me to tracker at 7.2% which seems rather high and risky seeing as interest rates look like they're going up. They'll also charge £49 to switch it. I was wondering whether using savings to get the loan amount down to £25k would be  better. Then I could apply for a loan at 6.1percent with no early repayment charges and pay it off that way. 

 Is this a stupid idea? Are there any lenders that specialise in small mortgages?

 I'm also self-employed which might make a difference.

 Any advice would be greatly appreciated. I'm very confused.

 Thanks.