Remortgage

GOLFER

I want to remortgage but dont know whether i should take fixed rate or tracker?

Any comment would be welcomed

Many thanks

PS I have under 75% LTV.

herbiesjp

What are the actual figures involved?

I ask that, as if you are close to 75% be wary of house values coming in lower than expected in the current climate - which would mean having to look at different rates with most lenders

rp8049

I'm in a similar situation. My personal opinion (and that's all it is!) is that a tracker is the way forward at the moment. The Base rate is likely to drop either a quarter or half point on Thursday, and there is a lot of speculation that it could drop by anything up to 2 points in the next year or so.

Fixed rates are not great at the moment, and with all the turmoil, the Libor rate is not likely to come down any time soon. A tracker should offer the chance to reap the benefits of a falling base rate right now while not necessarily having any tie ins should a fixed rate come up.

luckyfool

I would personally go with a tracker, but again the right option will depend on your circumstances and whether you have the flexibility in your budget to be able to risk your payments jumping substantially.

Howlinbob

I remortgaged 2 months ago with the Co-Op to a 2-year tracker at 5.99%, which was by far the best deal they were offering. I notice now that their fixed rate deals have come down a bit, from 6.89% to 6.79% on the 2-year fixed, and as low as 6.49% on a 10-year fixed. OH is in a panic because of the financial meltdown and wants to change to a 10 year fixed. He has even got the Co-op to waive their 3% ERC fee (£3K to us) so that we can switch to their more expensive product. Whilst he's very pleased with himself, surely that just shows what a good deal we're on at the moment, and how keen they are to move us onto a worse deal.

Most people I know are on trackers at the moment. If you look at the history of the base rate it moves gradually and doesn't take big jumps. In any case, it is expected to go down before it goes back up again, and I'm only locked in for 2 years. If you are nervous about the rate going up, you could save a regular amount by taking advantage of the low rate now. Then after your locked in period, hopefully the financial climate will have stabilised and then there will be other deals available.

GOLFER

Thanks for all the info.

Figures are 120k over 20 yrs with last valuation of £195k in June 08.

Think the tracker sounds good now just got to go a source bes options.

Many thanks to all who responded

Thnaks

Golfer

herbiesjp

Even if teh value came in at £160k you will still be at 75% LTV so looking at the better deals at that level.

As others have said I would personally go for a tracker as well - I'm already on one.


But it will depend on your budget and affordability, so as long as you have the ability to cope with rate rises, then with rates cuts expected it could be a better option for you