Advice on Lifetime tracker

YORKSHIRELASS

Hi, have made myself dizzy reading all the various threads on here! Our fixed rate of 6.19% ends next month. We have been offered 3.99% fixed for 2 years which doesnt really tempt me. Our house is worth about £180k and our mortgage is £45k. We have no plans to move, ever!

If we do nothing we go on a Lifetime Tracker of 0.95% over base rate. My thinking is that the base rate would have to go over 5.25% to make us worse off than we are now. Is this right?

We have got other debts which I am working hard to clear and we dont have a lot of spare cash. My thinking is that if we stay on the Tracker for now I could throw the money we save at the debts.

Anyone got any thoughts on this? I am fairly clued up with money stuff usually but am getting myself in knots with this!

opinions4u

YORKSHIRELASS wrote: »

If we do nothing we go on a Lifetime Tracker of 0.95% over base rate. My thinking is that the base rate would have to go over 5.25% to make us worse off than we are now. Is this right?

You got it.

We have got other debts which I am working hard to clear and we dont have a lot of spare cash. My thinking is that if we stay on the Tracker for now I could throw the money we save at the debts.

Good plan.

Anyone got any thoughts on this? I am fairly clued up with money stuff usually but am getting myself in knots with this!

If it was me, I'd be doing exactly as you propose.

figgles

If you move to the tracker you'll have reduced payments for a few months until rates increase. Many people believe rates will stay this low for 6-9 months so if you can use the spare money over that period to pay off other debts then do it as your monthly outgoings will reduce anyway by the time the rates start to increase so you wont notice much difference.

If your other debts are CC's, I'd suggest clearing them one at a time, starting with the one charging the highest interest rate per month, pay the minimum off any others and as much as possible off this. Once it's cleared, move to the next lowest (and get rid of the now £0 balance card!!).

I was in a similar situation myself a number of years ago and managed to get myself debt free (bar a mortgage) within a year (3 CC's and a car loan all repaid in 12 months). Best thing I ever did.