Which fixed rate mortgage? 5-year (4.99%) or 7-year (5.39%) - You decide!

steve237

steviehud37 wrote: »

I spoke to Abbey this afternoon and yes they are withdrawing some deals but not every fixed rate deal
The lady said i should check web site Wednesday morning for a update

I have arranged a meeting with abbey on Thursday
They offered me 4.99% Fixed Rate 5 Years No fees-New customer

Hope this helps

I was told only the 2 year fix would be available. She gave me the impression this applied to everyone, but looking at their website, although 7,10 and 15 year deals have been pulled, 5 year fix is still available but all fixed rates have increased.

andrewmp

5 Year Fix at 4.99% - this should be long enough to weather the storm

nrsql wrote: »

I keep being tempted by first direct 3yr fixed offset at 4.09%.
I'm currently on variable .89% above base = 1.39%

The FD mortgage would be for as much as possible so I could transfer a btl mortgage on to it in a years time when there are no charges (already transferred one) and maybe buy another rental property.

So - when is the boe rate going to hit 3.2%?

In my opinion you'd be mad to take a 3 year fix at 4.09% if you're currently tracking 0.89% above BOE base rate. I can't see rates rising for another year and when they do it'll probably be gradual. Saying that, I've never seen the point of such short term fixes as they offer little security.

Peelerfart

Am I alone in thinking that the rush to fix, and give up very good rates is becoming a little lemming like ?

Or am I wrong,as has happened so often before ?

steve237

Peelerfart wrote: »

Am I alone in thinking that the rush to fix, and give up very good rates is becoming a little lemming like ?

Or am I wrong,as has happened so often before ?

I don't think my SVR of 4.24% is that good. If it was 2.5% like some people I would be thinking twice about fixing just yet...

Peelerfart

steve237 wrote: »

I don't think my SVR of 4.24% is that good. If it was 2.5% like some people I would be thinking twice about fixing just yet...

Agreed Steve

steve237

Update - just called Abbey. Today, they can offer me the following:

3 years - 4.99%
5 years - 5.49%

The 7 year is now unavailable.

I am signing my 7-year fixed rate paperwork and sending it recorded delivery this afternoon! Feels quite good knowing I didn't miss out on this... although still wondering whether maybe I should have done the 5-year at 4.99% while it was there.

But glad I am going with my original gut instinct.

snarffie

5 Year Fix at 4.99% - this should be long enough to weather the storm

Peelerfart wrote: »

Am I alone in thinking that the rush to fix, and give up very good rates is becoming a little lemming like ?

Same thing happened about a year ago, and rates sank like a big stoney thing, in direct contradiction to their 'advice'. The banks/brokers current strategy of scaring people into fixing is also working like a dream if this forum is anything to go by. My first instinct when helpfully advised on anything by any bank/estate agent/national broker is to wonder what their angle is.


Of course, a person's personal decision to fix or not depends on balancing risk against reward, for example:

Saving a few hundred quid a month on a 1% tracker (against switching to a 5%fix), may be worth the risk, whereas saving a few tens of pounds a month on a 4.24% svr may not.

DAREDEVIL78

Hi , i think the 7 year offer sounds fine to me, i am in a fixed rate of 5.75% taken in 2006 and doesnt expire til 2010 , eventhough the svr rates are low and makes my rate seem higher i still feel happy and secure knowing what i will be paying ,there are no gambles, i'd rather be secure and happy.

snarffie

5 Year Fix at 4.99% - this should be long enough to weather the storm

DAREDEVIL78 wrote: »

Hi , i think the 7 year offer sounds fine to me, i am in a fixed rate of 5.75% taken in 2006 and doesnt expire til 2010 , eventhough the svr rates are low and makes my rate seem higher i still feel happy and secure knowing what i will be paying ,there are no gambles, i'd rather be secure and happy.

Fixing is also a gamble. You 'gambled' on your fixed rate being better than a tracker over the term. You may (or may not) have lost on your gamble, from a financial point of view. I gambled on the opposite last year, and I won to the tune of about £6k. This year, my luck may be out....

Of course, the payoff from your gamble is certainty of fixed monthly payments, which is pretty damn important, as you say.

steve237

I hope I get this latest 7-year fix gamble right. I'm currently paying 0.34%..... have had a great run on this below base-rate tracker!! I wish I could say I have been overpaying my mortgage but I'm afraid I haven't :cool: