7 year Fixed.

TobyPro4

Hi all, first post.

Our 3 year fixed with Northern Rock ens on 1st Jan 09 so I'm currently on the hunt for a new deal.

We owe 81K, house valued at 160K so fortunately we fall into the best LTV category. I know there's a good few very tempting trackers out there at the moment (3.99 at HSBC etc) but we have a one year old child and so want the peace of mind of a fixed, albeit we'll be on a higher rate.

I'm going to see C&G next week to discuss a 7 year fixed at 4.84 (currently on £70k of the mortgage at 4.79 and the other £11k at 6.09).

We're happy with 4.84, sort of happy with the £995 fee but it's the 7 years we're a little unsure of. A lot of people we've spoken to have hinted that it's far too long and no-one should really fix for more than 5 years.

Do any of you good people think 7 years really is too long to tie yourself to one lender and one rate?

opinions4u

Do you plan to stay in the same house for 7 years?

If not, is the product portable to a mortgage on a different property?

Are you happy with the rate?

Are you happy with the penalties if you want to escape the rate?

What happens to the penalty as you get towards the end of the term - does it stay level or reduce?

It looks a good deal to me, although other deals may become available in the coming days, so don't jump too quickly.

If you're happy with your answers to the above questions, then don't worry about the 7 years aspect to it.

manikm

TobyPro4 wrote: »

Hi all, first post.

Our 3 year fixed with Northern Rock ens on 1st Jan 09 so I'm currently on the hunt for a new deal.

We owe 81K, house valued at 160K so fortunately we fall into the best LTV category. I know there's a good few very tempting trackers out there at the moment (3.99 at HSBC etc) but we have a one year old child and so want the peace of mind of a fixed, albeit we'll be on a higher rate.

I'm going to see C&G next week to discuss a 7 year fixed at 4.84 (currently on £70k of the mortgage at 4.79 and the other £11k at 6.09).

We're happy with 4.84, sort of happy with the £995 fee but it's the 7 years we're a little unsure of. A lot of people we've spoken to have hinted that it's far too long and no-one should really fix for more than 5 years.

Do any of you good people think 7 years really is too long to tie yourself to one lender and one rate?

who valued the house!? your new to be lender? or are you going by a random estate egents valuation?

TobyPro4

Opinions thanks for reply. Yea we plan to stay in the house. We've done an awful lot to it, love the area and plan on it being the home our duaghter grows up in. I'm not sure about the penalties you mentioned, that'll be something I'll raise with C&G when I go and see them. It was, pretty much, just the 7 year aspect of it - feels like an awful long time when you're coming off a 3 year fix!

I take your point about other deals becoming available soon and not to be hasty but I don't want to play the waiting game indefintely, we'll be on N Rocks SRV come Jan 2nd. Besides, you know how it is - you become obsessed about finding a slightly better deal next week, then another the week after etc etc. Sooner or later we need to sort it out and 4.84 sounds quite attractive to me.


Manikm - it was a comination of an estate agents valuation and also some net research I did on what things were going for round our way. One for sale at £159,995 two doors up and one at £163,000 on the next street to me.
Why the interest in the valuation anyway?!

luckyfool

TobyPro4 wrote: »

Manikm - it was a comination of an estate agents valuation and also some net research I did on what things were going for round our way. One for sale at £159,995 two doors up and one at £163,000 on the next street to me.
Why the interest in the valuation anyway?!

A mortgage valuer is unlikely to come back with as high a valuation. They have to go by actual recent sale prices, not pie in the sky asking prices. In the current market the only things selling are discounted by 10-15% so I would not be too surprised if you got a valuation of £145 -£150k on your property. Bear that in mind when looking at products.

hearts

With regard to the rate. If you are happy with it, take it. Remember though there is a good chance interest rates will fall again soon, so a better deal may be available later.
Asuming that you are happy with it, and that it is portable, I would think the 7 years is a good thing. Lets face it, if they do go down again, the only way from there then is up.
So as was said above your main concern should be portability.

TobyPro4

That's fair enough luckyfool. It's a fair point to go off what they actually sell for, not what they're up for.

But, if a valuation comes back at £159,995, and practically identical houses to yours seem to be going for very similar money, you end up believing that yours is worth that too I suppose.

Either way, the LTV shouldn't hopefully go above 60% even if C&G were to knock it down a fair bit from 160 on their valuation. The valuation doesn't mean much to me anyway because were here for the long term, I just don't want it to hit above 60% for the purpose of the remortgage.

TobyPro4

"So as was said above your main concern should be portability"

Honestly hearts, we're not planning on moving anytime soon if ever. We're in a 3 bed semi and have only got the one child, the areas great and we've put a lot of effort into getting it how we want it (the house that is, not the area!)

It being portable is probably the last thing on the list of criteria for us.

adandem

TobyPro4 wrote: »

"So as was said above your main concern should be portability"

Honestly hearts, we're not planning on moving anytime soon if ever. We're in a 3 bed semi and have only got the one child, the areas great and we've put a lot of effort into getting it how we want it (the house that is, not the area!)

It being portable is probably the last thing on the list of criteria for us.

We thought that about the last house we were living in, everyone thought we were joking when we said we were selling as we'd done so much there and we thought we'd always live there. But one day we just started thinking about a move and the seed was planted and we sold up.

All I'm saying is never say never.;)

I think the rate is good but I also think you should seriously consider the portability factor for this length of time.