It’s time – Part One

While we’re taking a break, the redone mortgage will (hopefully) be wading it’s way through the paperwork mire. We did all the application guff a couple of weeks back, signing up for a 5-year fixed-rate deal which looks to have been pretty much the best option for us. No fee, no transaction charge, and an OK interest rate.

We’re also changing lenders – Nationwide weren’t able to provide us with anywhere even close to the best deal – plus their valuation calculator is so wildly wrong in our case that it’s just about unusable. So we’re moving on.

The interest rate we’ve got isn’t as low as the base rate- but we never expected it to be. However, it’s a rate we’re happy with, and it lets us know what we’ll be paying between now and 2014, regardless of what interest-rate idiocy goes on between now and then. And that works just fine so far as I’m concerned.

We could almost certainly save ourselves a bit of money by just making some payments at the SVR rate, but I feel much happier with having the fixed-rate deal sorted out, and making the payments based on that. After all, when the rates go up – and they will – there’ll be a ton of people currently paying on the SVR rate who suddenly try to apply for a fixed-rate deal, at which point I’d lay money on the lenders immediately upping the charges for those deals.  So I’m happier being “stupid” (according to a couple of people I’ve talked with) and doing what we’ve done.

The other part of the deal is that we can overpay – and overpay by a significant amount each year – the mortgage. And that’s something I’d very much like to take advantage of.  I’ve written before about how I find the mortgage debt is something I’m very aware of so I’d be a lot happier to be paying off over the odds, and reducing the interest paid by a significant amount at the same time.

I’ve some ideas for how I’m going to work on the overpayments – but that’s a post for tomorrow.