Tools, Tricks & Advice For Comparing 2yr & 5yr Fixed term Mortgage.

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  • dimbo61
    dimbo61 Posts: 13,716 Forumite
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    It is not just about the rate or the 2/3/4/5 years you want to fix !
    Do you want OFFSET ? or Fixed rate ? tracker deals for life of mortgage ?
    Interest only deals have died a death so unless you have a BIG deposit and ways of repaying the loan which the BANK is happy with ( Non starter )
    Now I love offset mortgages and some do Family and friends and allow you to even offset cash ISA,s
    If you need security for a few years due to self employment, kids, part time work or reduction in income then a Long term fix might be for you!
    So much to take into account
  • strawberries1
    strawberries1 Posts: 865 Forumite
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    dimbo61 wrote: »
    It is not just about the rate or the 2/3/4/5 years you want to fix !
    Do you want OFFSET ? or Fixed rate ? tracker deals for life of mortgage ?
    Interest only deals have died a death so unless you have a BIG deposit and ways of repaying the loan which the BANK is happy with ( Non starter )
    Now I love offset mortgages and some do Family and friends and allow you to even offset cash ISA,s
    If you need security for a few years due to self employment, kids, part time work or reduction in income then a Long term fix might be for you!
    So much to take into account
    My LTV is 63%.
    I'm going fixed.
    I didn't consider tracker for life. I figure I would've paid down in 5yrs and if I go with a lender who gives good rates to existing customers I'll be getting a good rate.
  • getmore4less
    getmore4less Posts: 46,882 Forumite
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    poppy10 wrote: »
    Have you tried using the MoneySavingExpert mortgage calculator? It's very useful and may well answer your question

    MSE calculator can get the wrong answers.
  • strawberries1
    strawberries1 Posts: 865 Forumite
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    getmore4less wrote: »
    MSE calculator can get the wrong answers.

    Oh goodness! Which do you recommend GM4L?
  • getmore4less
    getmore4less Posts: 46,882 Forumite
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    strawberries1 wrote: »
    Oh goodness! Which do you recommend GM4L?

    understand out how mortgages work and do your own comparisons so you know the answers are correct for your circumstances and choices and know when a tool is giving the wrong or misleading results.
  • botchjob
    botchjob Posts: 269 Forumite
    5 year fixes are particularly good value right now, and as low as they are ever likely to get. The 63% loan-to-value will prevent you getting the very best rate though. If you could get it down to 60%, Tesco has one at 1.78% (£995 fee...) or HSBC and First Direct do one at 1.94% fee free.
  • strawberries1
    strawberries1 Posts: 865 Forumite
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    edited 22 March 2017 at 4:42PM
    botchjob wrote: »
    5 year fixes are particularly good value right now, and as low as they are ever likely to get. The 63% loan-to-value will prevent you getting the very best rate though. If you could get it down to 60%, Tesco has one at 1.78% (£995 fee...) or HSBC and First Direct do one at 1.94% fee free.

    Botchjob, I'll be left with about £5,000 after all my moving costs if I go up to 60% Is the norm to spend almost all savings on the purchase? I'm used to having savings although I know the market isn't for savers at the moment.

    I have no dependants and good credit.

    Thanks; found it here https://www.hsbc.co.uk/1/2/mortgages/mortgage-rates/first-time-buyer
  • getmore4less
    getmore4less Posts: 46,882 Forumite
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    edited 22 March 2017 at 7:41PM
    A 2 year deal will get you there.

    oh you decided a 5 year deal is better.

    how much are you borrowing? fee deals may be better
  • strawberries1
    strawberries1 Posts: 865 Forumite
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    edited 11 April 2017 at 12:03PM
    getmore4less wrote: »
    A 2 year deal will get you there.

    oh you decided a 5 year deal is better.

    how much are you borrowing? fee deals may be better

    What do you mean by 2yr fixed term will get me there?
    I'm undecided about length of fixed term.

    Regarding LTV, I was on 63% but botchjob suggested I try 60% as the rate is again even lower. I now see his point so I'm going for 60% LTV.
  • botchjob
    botchjob Posts: 269 Forumite
    edited 23 March 2017 at 5:00PM
    You'll have to do the sums to see if the numbers stack up but one way to get the LTV down to 60% would be to put more of your savings into the deposit then, after the mortgage has gone through, take out a personal loan to cover the moving costs.

    It may be that a 60% LTV mortgage + the repayments on a small personal loan make more sense over 5 years, than a 70% LTV mortgage does
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