Fixed rate

geordiepaul2001

Hi all,

Just wondering what would be a good fixed rate for a first time buyer in the current climate.
I am considering a 5.04% mortgage locked in for five years.

Paul

feisty1

sensible......................

_Andy_

Hi Paul

Impossible to say whether it's a good rate as we don't know the LTV (loan to value) or your own credit situation.

Regarding whether a five year fixed rate is 'right' I agree with Feisty, as it will give you security for the short and medium term.

geordiepaul2001

_Andy_ wrote: »

Hi Paul

Impossible to say whether it's a good rate as we don't know the LTV (loan to value) or your own credit situation.

Regarding whether a five year fixed rate is 'right' I agree with Feisty, as it will give you security for the short and medium term.

The LTV is 95%.
Myself and my partner both have secure jobs (NHS and emergency services) and a modest four figure deposit.
We don't have adverse credit history either.
We currently live in LA property that is too small for our needs.

Paul

mark55man

Given short term interest rates are lower than that have you thought about going with a tracker - about 3% and then look to remortgage if and when rates start to rise, which won't be for a while.

savings would depend on the amount of the loan. however, if you can stand the unease now of paying a bit more than others you will be certain to avoid the increase that is widely predicted in 3 years time

just finally, I am surprised that 5% is best for a FTB, I would look around again especially given recent rate cut

(all above ignoring fact that many still see 10%+ falls across the housing spectrum (with some areas higher))

_Andy_

mark88man wrote: »

just finally, I am surprised that 5% is best for a FTB, I would look around again especially given recent rate cut

The LTV is very high at 95% so the rate reflects the increased risk.

getmore4less

What is the lowest rate/fees you can get?

I would then evaluate that against going fixed.

eg. if it is a tracker at a lower rate than the fix you make payments as if it was at the higher fixed rate and see what the rates would have to rise to say at Y 1,2,3,4,5 to actualy make you worse off over the term of the fix

Remember if they don't get that high then you will be paying off more capital and not have another set of fees to pay in 5 years.

It then becomes a risk assesment on rates and where you think they will go

Do your jobs have incrimental pay rises based on service?
That would reduces the need for fixing, you will have the income increases to meet higher payment so some of the risk of rising rates is mitigated

One thing to watch out for is the follow on rate, with falling prices you are likely to be stuck with only that option once a fix ends so getting that right could be more important than anything else.

olbigead

Do you mind me asking where you found a 5.04% Fixed with that LTV?

I have a 10% deposit at the moment and haven't found anything near that good a rate!

Thanks

beecher

That's a low rate for an LTV of 95%. That's the rate I can get with an LTV of 30%! What's the arrangement fee with that?

I take it you've thought out the risk attached to an LTV of 95% in the present market?

Squish_21

olbigead wrote: »

Do you mind me asking where you found a 5.04% Fixed with that LTV?

I have a 10% deposit at the moment and haven't found anything near that good a rate!

Thanks

I was about to ask the same!

geordiepaul2001

olbigead wrote: »

Do you mind me asking where you found a 5.04% Fixed with that LTV?

I have a 10% deposit at the moment and haven't found anything near that good a rate!

Thanks

Not sure where, I arranged for a broker (through work) t do the digging for me. I must admit that I have found this rate for 90% ltv and wondered if my broker had made a mistake.

Currently we are saving between £500 - 750 per month, I may wait it out til the end of the year when I will be eligible for a lot more products.