2.7% above libor

mufc689908

Is this a decent mortgage deal?

Cheers

Forever_Red

You will have to post more details to get some decent opinions. Amount needed, LTV, good or bad credit ratings, lifetime tracker or do you want a fix etc....

Alan

Forever_Red

Libor currently at 1.20% therefore a rate of 3.9%, but is this tracking the Libor rate and for how long? What are the costs involved?

Alan

mufc689908

It kicks in when my current deal ends in Oct. If i understand it correctly it tracks the Libor until I change to a new package/different provider.

Self employed and took this mortgage out towards the end of 07 when the market was very choppy towards lone rangers like myself.

Told Uncle Malc to stick his ACS Season Ticket in 3103 up his a*se

LUHG.

Thrugelmir

mufc689908 wrote: »

It kicks in when my current deal ends in Oct. If i understand it correctly it tracks the Libor until I change to a new package/different provider.

Self employed and took this mortgage out towards the end of 07 when the market was very choppy towards lone rangers like myself.

Told Uncle Malc to stick his ACS Season Ticket in 3103 up his a*se

LUHG.

Suggest you shop around. LIBOR will rise as BOE base increases over time.

mufc689908

Thrugelmir wrote: »

Suggest you shop around. LIBOR will rise as BOE base increases over time.

If the Libor rises does the base rate not do the same therefore making all mortgages expensive?

allan673

mufc689908 wrote: »

If the Libor rises does the base rate not do the same therefore making all mortgages expensive?

effectively yes, the boe rate will rise too making mortgage interest rise.
consider a 5 or 10 year fixed rate.
ive fixed for 10 years.
how many years have you remaining???

Thrugelmir

mufc689908 wrote: »

If the Libor rises does the base rate not do the same therefore making all mortgages expensive?

Although I know what Libor is and how it is calculated. I do not profess to have a knowledge of how it compares to BOE base historically.

Other than LIBOR is the interbank lending rate which will always be above BOE base. The correlation to base rate and the margin above is something you would need to consider.

LIBOR is set daily so I assume the mortgage is based/revised on a longer term LIBOR rate. You would need to read the mortgage details to see how often its changed.

Personally I would assess the risks of this product before proceeding.