Mortgage Fixing Terms

[HungryHippos]

My fixed rate mortgage is ending at the end of June this year, contemplating what terms to renew on.

I am currently with Nationwide on a 2 year fix deal, that is at 2.29%.

Plugging in my details on the Nationwide site:

http://www.nationwide.co.uk/products/mortgages/existing-customer-switching/mortgage-rates#~

Type: Existing customer - deal ending.
Property Value: £153k
Mortgage Amount: £79k (what I have left on it)
Term: 23 years

Specifically looking for deals without arrangement fees as they often cost me more than I save over the term, I can get the following:

2 year fixed: 1.79%
3 year fixed: 2.14%
5 year fixed: 2.34%
10 year fixed: 3.14%

With interest rates probably rising at some point, I don't want to be caught out and have to fix later at higher rates.

But on the other hand 2 year fix deals seem like the cheapest short term, and if interest rates stay the same for 2 years I should be able to then fix for a longer term to beat the interest rate rises.

What length are you guys fixing for at the moment?

 

[HungryHippos]

My mortgage defaults to a really bad SVR (4%) so I need to fix or go tracker, I can't see any non-fixed tracker deals, so I'd need to go to a fixed term tracker, which is slightly lower interest rates but definitely would rise with any interest rate changes in the near future.

 

[HungryHippos]

Just coming back here to update what I did in the end. I went with a 2 year fee-free tracker deal at base rate + 1.09%. Right now this is 1.59%. I could get a better headline figure with a fee based product, but the fee would have made it more expensive over the term of the fix, something I didn't want to do and would just cost me more.

My remaining term is 20 years 6 months, so my monthly costs have come down from £400 to £372, saving a little bit per month compared to now. I also have no ERC so I can make as many over payments as I want, usually it's 10% of original borrowed amount per year as max over payments.

I can switch to fix whenever I want within the 2 year period as things stand, if it looks like interest rates will go up I can fix my deal if I want to without any penalty.

For me no product fees always seemed to work out better, even for the 10 year fix terms, as my outstanding mortgage is not very high the fees would be > 1% of my outstanding debt.