Should I look to get out my Fixed Rate?

cliffh

What seemed like a good idea a few years ago in taking out a Fixed Rate is now on face value proving the wrong decision with all the recent interest rate cuts.

I'm going to contact my lender to see how much I need to pay to switch to another product but what I'm not sure on (and I hope you folks on here can help me), is what EXACTLY do I need to know in order to make an informed decsion as I'd hate to jump only to realise I'd forgotten a bunch of stuff and would have been better staying off at 5.63%.

Many thanks in advance for all of your help.
Cliff

swiftnick

Hi Cliff

It would all depend on the penalty they would charge you to get out.

Probably best to speak to them first and then do your calculations.

Nick

MarkyMarkD

It depends a lot on:

- how long left you have at the fixed rate
- how big your LTV percentage is
- how good your income is.

If you have good income, and low LTV, then you can get the best rates currently on offer which are around 3.5% fixed for 2 years. If you only have 2 years left on your existing fixed, then it's worth paying penalties of up to 4% to switch - because that's how much you will save (roughly).

If you have longer than 2 years to go, then it's a question of considering the risk of giving up the longer fix against the saving in the short term.