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    • armour
    • By armour 13th Jul 17, 7:01 PM
    • 298Posts
    • 197Thanks
    armour
    Wither goes interest rates?
    • #1
    • 13th Jul 17, 7:01 PM
    Wither goes interest rates? 13th Jul 17 at 7:01 PM
    Hi All, I have a decision to make. Either I remortgage a btl at 2.55% fixed over 5yrs or I pay it off with some money which will be coming my way shortly. The outstanding mortgage is £78K. Over the course of the next 5 years, I've got a feeling that 2.55% will look cheap and the money would be better invested in a savings account.
    What d'yall think?
Page 1
    • AnotherJoe
    • By AnotherJoe 13th Jul 17, 7:08 PM
    • 6,910 Posts
    • 7,354 Thanks
    AnotherJoe
    • #2
    • 13th Jul 17, 7:08 PM
    • #2
    • 13th Jul 17, 7:08 PM
    I think you are absolutely wrong on interest rates, they may nudge up but i dont see much higher than now.
    However why wouldn't you lower the rate you are paying on your mortgage whilst keeping the amount high to maximise tax advantages. So a remortgage would be sensible.
    And if you are a high rate taxpayer the better place for your money is almost certainly your pension rather than a savings account.
    • jimjames
    • By jimjames 13th Jul 17, 8:35 PM
    • 11,908 Posts
    • 10,292 Thanks
    jimjames
    • #3
    • 13th Jul 17, 8:35 PM
    • #3
    • 13th Jul 17, 8:35 PM
    I wouldn't pay off the mortgage, I'd invest the money (not put it in a savings account) either in S&S ISA or pension as suggested above
    Remember the saying: if it looks too good to be true it almost certainly is.
    • bigadaj
    • By bigadaj 13th Jul 17, 10:40 PM
    • 9,362 Posts
    • 5,983 Thanks
    bigadaj
    • #4
    • 13th Jul 17, 10:40 PM
    • #4
    • 13th Jul 17, 10:40 PM
    It's difficult to see interest rates rising rapidly in the near future, too much consumer debt let alone the vast quantities on mortgages for over priced housing.

    No one is going to thank the person turning off the heroin like hit of ultra cheap money, but the spectre of Japan should be looming for all western economies, decades of moribund growth and an inability to inflate debt away.
    • economic
    • By economic 13th Jul 17, 10:54 PM
    • 1,581 Posts
    • 737 Thanks
    economic
    • #5
    • 13th Jul 17, 10:54 PM
    • #5
    • 13th Jul 17, 10:54 PM
    my fixed portion of the mortgage is maturing so and im considering sticking to trackers. much cheaper.
    • eskbanker
    • By eskbanker 13th Jul 17, 11:35 PM
    • 5,047 Posts
    • 4,793 Thanks
    eskbanker
    • #6
    • 13th Jul 17, 11:35 PM
    • #6
    • 13th Jul 17, 11:35 PM
    Wither goes interest rates?
    Originally posted by armour
    I think you'll find they've been withering for quite some time....
    • armour
    • By armour 14th Jul 17, 7:56 PM
    • 298 Posts
    • 197 Thanks
    armour
    • #7
    • 14th Jul 17, 7:56 PM
    • #7
    • 14th Jul 17, 7:56 PM
    Thanks for all the replies. I think I'm minded to fix at 2.55% for 5 yes. As a (soon to be retired) person who will be paying a 20% marginal tax rate, it's effectively just over 2%. Given savings rates at the moment, it will cost me, but a 1-1.5% rate increase within a couple of years would put a different complexion on things.
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