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Debate House Prices
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Lenders and brokers say fix your mortgage
Comments
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I agree - interest rates play a huge part in affordability.
But you have to look at long-term interest rates - current rates don't matter much when looking at a 25 year debt, unless fixed long-term.0 -
Thrugelmir wrote: »So what do you consider a reasonable rate for a 10 year fix?
Even in the USA long term rates, which is more the norm over there, still average 4.59% for 20 year+ fixed. Even though the BR is more or less at zero. The mortgage rate only more recently has correlated to BOE base rate. On the back of tracker rate mortgages.
Interesting that long term fixes are still pricey - I guess the lenders aren't as stupid as I had hoped
Still, once the government take full control of the failed banking system and start spinning the presses so that they can hand money out like confetti I guess we'll see all sorts of enticing deals to get us borrowing.--
Every pound less borrowed (to buy a house) is more than two pounds less to repay and more than three pounds less to earn, over the course of a typical mortgage.0 -
Mortgage brokers love 2-3 year fixed rates. That means the customer has to come back to them in a 2-3 years time and that means more fees. repeat business is the best business.
Fixing long-term => financial security for the borrower. It may not be the cheapest deal, but it's the least risky in most situations.No reliance should be placed on the above! Absolutely none, do you hear?0 -
Fixing long-term => financial security for the borrower. It may not be the cheapest deal, but it's the least risky in most situations.
How can a fixed rate = financial security?
Surely all it does is able you to buget more effectively but will not give you any more financial security than any other mortgage?
Also any deal over 5-5% long term is over the long term average.
Personaly i think I will not fix unless I see under 4% long term as I can not see high interest rates for a long time. (not by the bank of UK anyway:))0 -
How can a fixed rate = financial security?
Surely all it does is able you to buget more effectively but will not give you any more financial security than any other mortgage?
Also any deal over 5-5% long term is over the long term average.
Personaly i think I will not fix unless I see under 4% long term as I can not see high interest rates for a long time. (not by the bank of UK anyway:))
I was thinking of all those people complaining that their fixed rate deal had ended and they were on the standard variable rate. If they had fixed originally for the length of their mortgage they wouldn't have had that problem. On the other hand, their broker would have had just one sale from them, rather than a new sale every 2-3 years for the rest of his career. So, you can see why those deals are not recommended much.No reliance should be placed on the above! Absolutely none, do you hear?0 -
I was thinking of all those people complaining that their fixed rate deal had ended and they were on the standard variable rate. If they had fixed originally for the length of their mortgage they wouldn't have had that problem. On the other hand, their broker would have had just one sale from them, rather than a new sale every 2-3 years for the rest of his career. So, you can see why those deals are not recommended much.
To tell you the truth if you add up the costs over 10 years doing a 10 year fixed and doing a low rate every 2 their is little difference.
What would have been the interest on a 10 year fixed in 1999?0 -
I was thinking of all those people complaining that their fixed rate deal had ended and they were on the standard variable rate. If they had fixed originally for the length of their mortgage they wouldn't have had that problem. On the other hand, their broker would have had just one sale from them, rather than a new sale every 2-3 years for the rest of his career. So, you can see why those deals are not recommended much.
there are probably as many that feel that their Fixed Rates are currently too high.
saying things in retrospect is all too easy for the 'experts'.0 -
If you fix the mortgage rate, you reduce the scope for nasty surprises.No reliance should be placed on the above! Absolutely none, do you hear?0
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