I've had to lock it in, rates are only going up, and this is the only provider we can go with as there is no credit-checking as existing customers, I doubt any other lender would touch us, and looking at the rates, they aren't really any different elsewhere
Mortgage Rate Rises
- Thread starter glenimp617
- Start date
If all it takes is not buying toys then you really should be focusing on paying it off surely? I mean I'd have already paid it off if that's all it took.
Soldato
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Then you choice is 2 or 5 year fix and a gamble on if/when rates may eventually drop.
Hard call to make, I'm fixed for another 4 years so luckily not something I need to worry about for a while.
Not exactly, I purchased it about 12 years ago on a 25 year mortgage, I didn't originally plan to pay it off so early or even relocate to another country for that matter. Overpayments helped but I am not on an unlimited overpayment deal.
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Ooof, so I am now 90 days out from our product ending.
My only options are:
5 year fix at 4.23% (£1,500/month)
2 year fix at 4.44% (£1,540/month)
The kicker?
Whilst I am able to reserve on the above now and have it kick in when my current product ends, if I do so, I am locked in, I cannot change my mind closer to the time if rates come down.
FFS
No option for a tracker with them?
I'd take tracker now. But I say that from security of being sorted. If I was actually needing to make the choice.. I'd want to go on a tracker. But would I?
I truly feel the peak is now kind of in.
If you look at best fixed rate savers when I got mine in December BoE rate was lower but rates were better. I see this as a sign that lenders see rates coming down quite soon. (late 2023)
I wouldn't want to lock in 4-5pc for 5 years. 2 isn't so bad.
I don't see rates going much higher as it really would stuff the economy.
I'll add that I also don't think the impact on the rate rise has been seen until about now. House sales, house prices, defaulting on loans. That's going to start happening now. If you think how long you could survive even living beyond your means? Next 6 months will likely bring the real figures and real life affects. So I doubt rates need to rise much more.
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I'm leaning towards fixed 5 year over a tracker. Looking at the maths of it, if it does peak in late 2023, then come down (depending how quick it comes down) if might not get back down to current rate until mid 2024, then if it keeps going down it has to drop for another year or more before the average gets down to the fixed rate (which is lower now than the tracker) so to me the maths says even if it's the wrong choice, it wont be that wrong. On the flip side, if I go tracker and it doesn't come down in the next year, maybe it doesn't get down to the 4% I can lock into for 2 or 3 years, I could end up paying a lot more that I hadn't planned for.
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Well it won't be long for me now, decisions, decisions
Deleted User 298457
Deleted User 298457
Tbh to save £20 you may as well fix. Even if it goes down substantially you'll still only be 40-50 quid better off?Well it won't be long for me now, decisions, decisions
Deleted User 298457
Deleted User 298457
On the flip size increases are hardly going to cripple you either.
Soldato
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This basically tracker would be 4% + change then.
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and with a tracker no ERC or limits on overpayments. I'm tempted with the tracker, but we desperately need a new kitchen and bathroom so can't see me overpaying much for the next couple of years anyway
Nope, there was last week, but the timing of my 90 day thing came annoyingly just after the new rate announcements, so it was gone when I was finally able to lock in without an ERC, grrrr
Soldato
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I've still got 2 years left on 1.49% so going to ride it out and hopefully will come down a bit by then.
What if I end up tracking and it goes up to 6pc again. ?
Soldato
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No one can say what it will do 100% so you have to follow your own defined best course of action!
You have to make a choice at the end of the day. Nobody can have a pop at anyone for making any decision. We all take the best one we can given the circumstances. I personally can't see 6%. Repossessions would be vast at that level. I don't think that would be "allowed" so to speak.
Good luck! If you manage it be sure to come back to the thread for a humble brag on how you’d like to see interest rate go to the moon!
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argh, there is another thing to consider when chosing between a 2yr tracker or 5yr fixed. That's the £999 product fee.
Once the 2yr tracker is up I'll need to find a new deal and spend another £999. That £20 a month saving might not be worth it.
I'm starting to think I need a new username. I mean, can anyone see rates falling by a decent amount between now and the next 5yrs, or will they settle around the high 3s? This year is out of the question, I can't see them dropping until very late '23 or early '24.
Now thinking 5yr fixed. If I do a 5yr fixed, gonna be great for all you lot as I guarantee rates are gonna drop through the floor the day after I sign!
Once the 2yr tracker is up I'll need to find a new deal and spend another £999. That £20 a month saving might not be worth it.
I'm starting to think I need a new username. I mean, can anyone see rates falling by a decent amount between now and the next 5yrs, or will they settle around the high 3s? This year is out of the question, I can't see them dropping until very late '23 or early '24.
Now thinking 5yr fixed. If I do a 5yr fixed, gonna be great for all you lot as I guarantee rates are gonna drop through the floor the day after I sign!
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