Fixed or Variable Rate????

EMcL

Hi,

New to this, so please bear with me!

Our fixed rate Mortgage (~£97k) with A & L is just about to finish (and payments will go up by about £100/month), but we are now being offered either variable tracker or fixed rate options to bring it back down a bit. We are able to meet the payments without any probs and are trying to decide what is the best to go for. Any suggestions based on what we think is going to happen to interest rates over the next 2 years?

Any help would be very welcome as I am struggling to get my head around this!!

Thank you in advance,
EMcL

P.S. What A & L are offering is as follows:

Variable Tracker - 5.39%, 2 yr (0.89% + 1.99% below base rate), Fee of £727, Payments - £648
Variable Tracker - 6.09%, 2 yr, No Fee, Payments - £683

or

Fixed 2 yr - 5.99%, 1% (~£970) Fee, Payments - £684
Fixed 2 yr - 6.19%, £399 Fee, Payments - £691
Fixed 2 yr - 6.79%, No Fee, Payments - £724

cookie666

Hi,

We are in almost exact situation as you but with 99k to go, my FA has advised a tracker deal and I think I am going to go with the one offered by C&G who we currently have our mortgage with.

Rates are almost the same as yours with payments being a couple of pounds of, our fee was £495 though.

Our FA reckons interest rates will only go down over next 2 years (only an opinion not fact!!) so reckons the tracker is the best option.

Just waiting for his ok before I proceed......