Fixed rate mortgage costs drop

This thread is to discuss the following news story:

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  • Good timing!

    Bit of turmoil going on at the moment -

    Abbey withdrawn its 3.95% 5yr fixed - their best rate now is 4.49%
    A&L withdrawn 3.99% 5yr fixed (no fees) today at 12pm - replaced with 3.95% 5yr fixed with £995 fee
    Woolwich back in the running with a 3.99% 4yr fixed - was 4.29%
    HSBC still offering 3.99% 5 yr fixed with £999 fee - no change (yet)

    There's changes afoot
  • TwopintsTwopints Forumite
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    You pay your money....
    Mortgage brokers were last night calling the bottom of the fixed-rate home loan market.

    They claim that the money markets are indicating that rates’ next move will be up. Market rates, which determine the cost of fixed-rate mortgage lending, increased from 2.96 per cent a fortnight ago to 3.15 per cent yesterday.

    http://www.timesonline.co.uk/tol/money/property_and_mortgages/article5983385.ece
    Not even wrong
  • AnonAnon Forumite
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    And Lloyds/C&G team were predicting the bottom of the market over a month ago saying fix now - which was followed within days by their competitors offering new fixed deals even lower. Notwithstanding that rates will go up at some point, in my opinion these stories seem to come out intermittently from people/companies with a vested interest, perhaps when mortgage business is slowing again, to spook people into jumping now rather than waiting any longer.

    Anon
  • Woby_TideWoby_Tide Forumite
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    AntiLochus wrote: »
    A&L withdrawn 3.99% 5yr fixed (no fees) today at 12pm - replaced with 3.95% 5yr fixed with £995 fee

    The first deal was a 65% max LTV deal, the new one is 60% max so comparisons even harder with them changing terms as well as rates
  • snarffiesnarffie Forumite
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    Anon wrote: »
    ....Notwithstanding that rates will go up at some point, in my opinion these stories seem to come out intermittently from people/companies with a vested interest, perhaps when mortgage business is slowing again, to spook people into jumping now rather than waiting any longer....

    Anon

    This is just another reason why it's so difficult to know when to fix. We all know that the banks/financial institutions are complete liars serving their own interests, and NOTHING else.

    I'm on a lifetime BBE +0.23% (0.73%), and I'm saving about £275 per month against the current best five year fixes. I'd also have to pay about £1k in fees, doesn't help.

    I'm not going to try to work out when the rates hit bottom. My plan is to wait for the upturn in rates...that way I'll actually miss out on the very best 5 year fixes, but will avoid the worst of the rate hikes, whilst taking advantage of the savings made with my existing deal for as long as possible. It's as good aplan as I can muster anyway, until somebody changes my mind :rolleyes:
  • snarffie wrote: »
    This is just another reason why it's so difficult to know when to fix. We all know that the banks/financial institutions are complete liars serving their own interests, and NOTHING else.

    I'm on a lifetime BBE +0.23% (0.73%), and I'm saving about £275 per month against the current best five year fixes. I'd also have to pay about £1k in fees, doesn't help.

    I'm not going to try to work out when the rates hit bottom. My plan is to wait for the upturn in rates...that way I'll actually miss out on the very best 5 year fixes, but will avoid the worst of the rate hikes, whilst taking advantage of the savings made with my existing deal for as long as possible. It's as good aplan as I can muster anyway, until somebody changes my mind :rolleyes:

    I couldn't agree more. There are good fixed rate deals to be had for those who need a new one because their own incentive period is coming to an end. This need not extend to those on decent fixed rates or trackers with low tracking margins.

    Before opting for a new fixed rate work out the additional expenditure and how long into the deal it will be before you break even or are in profit.
    RIP independent MSE.
    Died 1st June 2012
  • beecherbeecher Forumite
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    snarffie wrote: »
    I'm not going to try to work out when the rates hit bottom. My plan is to wait for the upturn in rates...that way I'll actually miss out on the very best 5 year fixes, but will avoid the worst of the rate hikes, whilst taking advantage of the savings made with my existing deal for as long as possible. It's as good aplan as I can muster anyway, until somebody changes my mind :rolleyes:

    This is the way I'm beginning to think too. Not too worried about getting the best possible 5 year deal, but wouldn't be happy to jump on one and find that my SVR remains lower for a long time, particularly once fees are taken into consideration.

    Agree completely with others talking about vested interests - you can't trust anyone really!
  • dannykosdannykos Forumite
    78 Posts
    beecher wrote: »
    This is the way I'm beginning to think too. Not too worried about getting the best possible 5 year deal, but wouldn't be happy to jump on one and find that my SVR remains lower for a long time, particularly once fees are taken into consideration.

    Agree completely with others talking about vested interests - you can't trust anyone really!

    agree - horses for courses.

    I was coming off an A&L 2.05% SVR discount (=2.94%) - and so had to account for the cheapest currently available tracker (FD) at 2.89% + £799 fees, which is only 1.1% below the 5yr A&L fix I took.

    I figured that, allowing for the fees - the base rate only has to rise by 1.5% over the next 2 years, and I'll be saving by being on the 5yr fix.
  • Heyman_2Heyman_2 Forumite
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    snarffie wrote: »
    This is just another reason why it's so difficult to know when to fix. We all know that the banks/financial institutions are complete liars serving their own interests, and NOTHING else.

    I'm on a lifetime BBE +0.23% (0.73%), and I'm saving about £275 per month against the current best five year fixes. I'd also have to pay about £1k in fees, doesn't help.

    I'm not going to try to work out when the rates hit bottom. My plan is to wait for the upturn in rates...that way I'll actually miss out on the very best 5 year fixes, but will avoid the worst of the rate hikes, whilst taking advantage of the savings made with my existing deal for as long as possible. It's as good aplan as I can muster anyway, until somebody changes my mind :rolleyes:

    It's a difficult one isn't it? I'm in a very similar situation (lifetime tracker at +0.79%) although my LTV is high so if I were to fix now, I'd be looking at a rate of around 6% with around £1000 in fees. That would increase my current monthly payment by £500 a month :eek::eek:
  • Heyman wrote: »
    It's a difficult one isn't it? I'm in a very similar situation (lifetime tracker at +0.79%) although my LTV is high so if I were to fix now, I'd be looking at a rate of around 6% with around £1000 in fees. That would increase my current monthly payment by £500 a month :eek::eek:

    From what you've said the base rate would have to go up by another 4% before the tracker and fixed rates are roughly the same. That should make your decision relatively easy.
    RIP independent MSE.
    Died 1st June 2012
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