calculating mortage interest?!

[richard plumb]

Can someone help work out which is better?

I have some options when remortaging with Nationwide:

tracker:
Pay £499 and get 0.13% *below* BOE base rate for 2 years
Pay nothing and get 0.27% *above* BOE base rate for 2 years.

How do I calculate what that 0.4% difference equates to on a £150k mortgage?


Another option was

Pay £399 and get 0.18% *above* BOE base rate for the full length of the mortgage. Tied in for 5 years but no penalty if switching to a fixed rate before then. Does that sound good?


I'm currently paying 0.04% above base but its running out in August. Of course I'll check other options too

0.4% as a fraction is 0.004, so assuming it's an interest only mortgage, then the difference in payments per year is


0.004 * £150000 = £600 PER YEAR so you would be better off paying the £499 as you'll still be £700 better off after two years...........

[vnb]

You need to use a mortgage calculator - loads on the web http://www.cml.org.uk/cml/consumers/...mortcalculator

eg 150k @4.4% = £834 month on repayment over 25 years (the term does make a small difference)
150k @4% =£800

£34 a month over 2 years is £816 saving you £317

regards,
vnb

[shay0]

The other alternative is to ask the lender. If they can't tell you exactly how much you'd pay & save, then its a poor do