First Direct 2.99% Mortgage - Any advice welcome!

elmec2006

My two year fixed at 5.34% with Abbey finishes in August (Thank God I didn't go for a 5 year fixed as advised back in August 07 by my friendly broker!) and I'm trying to make a decision on a next step.

I've read a couple of threads here and thinking about it a five year fixed at 3.99% does make some sense but the one catching my eye at the moment is a 2 year fixed rate with First Direct at 2.99%.

My mortgage is going to go down from £740 to £350 (I'm paying some off) hence it's a very tempting offer.

However I'm in the same boat as a lot of people and wondering if 2.99% fixed is likely to be as low as things will go. Normally I would just reserve it and then just pick another if it went lower but FD want a £599 fee up front.

On the one hand I'm worried about this offer disappearing and on the other I'm worried that I'll pay the £599 and something else will come up.

The Monetary Policy Committee are meeting on the 8&9 of April so should I wait until then and see if the rates go down to 0% or should I bag this fee now??!!

Any advice welcome, anyone with a crystal ball even more welcome!!

will-in-estoril

You'd have to fork out £898 in arrangement and booking fees, as well as normal remortgage disbursements. Seems a lot of money for such a short term fixed rate. Will you save more than you've spent?

Are Abbey not doing a fixed rate of 2.99%? This might be a cheaper option for you.

elmec2006

Thanks for pointing out the Abbey mortgage I wasn't aware they were doing one. I think I'm going to look into the 3.99% HSBC 5 year deal. I'm thinking of upgrading properties in the next 2 years to a significantly larger mortgage so the savings at 3.99% as a pose to a 4.99% or 5.99% which might be the going rate in a couple of years could be quite a lot.

I'll need to call HSBC though to find out how they stand on loan against property ratios.

Anyway I've got the Excel formlas and calculations going on so I'll weigh it all up.

Thanks for the advice