Post Office 5 year fixed mortgage 2.83% with no arrangement fee (max 60% LTV)
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Post Office 5 year fixed mortgage 2.83% with no arrangement fee (max 60% LTV)

7
Found 19th Dec 2014
This looked like good value if you're looking for the reassurance of a longer fix and have 40% deposit available (e.g. because it's a remortgage)

No arrangement fee. A lending fee of £195 applies which is due on completion but payment can be deferred until your mortgage is fully repaid.

7 Comments

So there is an arrangement fee then, called something else!!

Very competitive. Thanks for posting

Original Poster

BTW, depending on your mortgage requirements (they'd have to be quite high) you might be better off with their 5 year fixed mortgage that is just 2.55% but comes with a £1,495 arrangement fee as well as the £195 lending fee.

(Sorry, the math is a bit beyond me to work out exactly what amount you'd have to borrow for this trade-off to be worth it)

Original Poster

Following up my previous comment, if you were borrowing £200,000 it looks like you'd be slightly better off going for the lower 5-year % but paying the arrangement fee. At least, according to this mortgage calculator tool.
thisismoney.co.uk/mon…tml

(At £300,000 borrowing level, you'd be almost £1,000 better off by going for the lower % rate but paying the arrangement fee)

I make it a mortgage in excess of 106780 to make in beneficial to pay the 1495 arrangement fee. Feel free to correct me if I've got it wrong

Original Poster

Mildoo

I make it a mortgage in excess of 106780 to make in beneficial to pay the … I make it a mortgage in excess of 106780 to make in beneficial to pay the 1495 arrangement fee. Feel free to correct me if I've got it wrong



No, it's around £175,000 assuming I've put the right numbers in.

Mortgage #1
Amount borrowed: £175,000
Arrangement fee: 0
Term (years): 25
Interest rate: 2.83%
Initial deal period: 5 years
Cost over deal period in fee (calculated by tool): £48,868.75

Mortgage #2
Amount borrowed: £175,000
Arrangement fee: £1,495
Term (years): 25
Interest rate: 2.55%
Initial deal period: 5 years
Cost over deal period in fee (calculated by tool): £48,864.59 (saves £4.16)

And of course the difference gets larger and larger from there as the mortgage amount climbs.
Edited by: "Genki" 19th Dec 2014

Thanks OP
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