10yr Fix? really new to the mortage game!

Jacka87

It is definitely quite possible that the outcome of current policy will be a period of high inflation and a sustained rise in interest rates

You have gave me much to think about with your previous posts in making me consider other options against the long fix. However this line killed it for me. I do think interest rates will be high, I think they will rise from now until around the 2-5 year point, between 2-5 yrs they will peak but will prob stay fairly high in that period. Thats my prediction and thats what I am betting against so I am defo going to fix. particularly since the stability will give me a chance to build and consolidate my finances for the future.

My main concerns are now around making hay whilst the sun shines. I would love to keep my rates as they are just now for as long as possible, that way I can reduce the mortgage value whilst its cheap. The problem is whens it going to start raining (rates going to rise)?

Again though I must say that you put very good points across samizdat

Fella

If I had a mortgage at the moment I would definitely fix for around 10-years.

For me the overwhelming argument is the potential upside/downside.

The potential downside of fixing as far as I can see is:

- the risk that interest rates stay ultra-low & you end up paying more than you needed to.

- the risk that circumstances change & you need to redeem early thus incurring fees.

However, although either situation could be costly I think that both pale in comparison to the (very real IMO) downside of NOT fixing. i.e.

- Interest rates shoot up over the next 1-4 years & you end up paying double (triple..?) size repayments.

There is absolutely nothing I've seen that suggests the threat of double-digit inflation has been eliminated forever. We have already seen that other similar statements (the elimination of boom & bust) have been proved to be empty words. And there is a very compelling argument for the US/UK Governments to allow inflation to rise. Far easier for them to inflate away debt than to pay it back (which would require large tax increases & huge cuts in public spending).

So a long-term fix would be an absolute no-brainer for me, despite the excellent points raised by samizdat.

Grz.26

I have saved up for a long time, but put that money into the house when I remortgaged thus under 60% LTV and opted for a fixed 10 year deal with RBS. Very good in comparison at 4.89%, with a 10% over payment allowed per year. RBS was my current lender.

I think after 2/3 years when you come to remortgage again the rates will be higher hence why I went for peace of mind now.

Good Luck.

Jacka87

Grz.26 I would like to ask how long ago it was that you got that deal because it does not seem to be on offer any longer??

I had almost agreed that mortgage but realised I could not carry it out until July and notice it has since been pulled from the market. Which was what prompted this thread in the first place, does anybody know why the amount of 10yr fixes seem to be reducing?