When to jump from SVR

kriss_boy

koexelek wrote: »

The C & G SVR is one of the best.

I'd be reluctant to move off of that at the moment

Yup, my tracker is only 1.23% above BoE so no desire to move to a fixed rate at the moment.

I just cant see the BoE int rate rising substantially any time soon as that would be really bad for the economy.

Bassey

With interest rates as they are I would stay as is, just to set up the new mortgage will offset any savings you may make

tododo

Im currently on an SVR @ 4.25% with britanna
Ive been kinda lucky to secure a fixed rate mortgage with them at 4.44% 1K free (pulled a day later)..........this lasts until the end of September

Im dithering weather or not to fix now or just stay on the SVR a bit

As Im changing jobs soon I think im more likely to get this fixed next month tbh

joebmc

I’m currently on Nationwide’s 2.5% SVR (BMR or whatever they call it). Think I’ll stay on it till at least the New Year but keep my eyes on the rates.
One thing that worries me is if say the BOE rates rise back up to 5% would that mean most fix rates would be around 9-10%?

jnofrills

I currently on First Active's svr (1 point something above boe) and recently asked a broker to look at a re-mortgage on fixed rate. He has come up with Abbey's 2 year at 4.29%. I have just received Abbey's offer but am really having cold feet, it remains open until end of October.

Current mortgage is interest only £72k (approx 30% ltv) and Im paying £99/month.

New mortgage would be for £65k (as I would be able to pay off £8k), and on a repayment basis £403/month. Its a fees free deal, tho my broker isnt!

My thoughts now: I should stick with current First Active svr and stash £300 in a high interest account along with my £8k, and look at remortgage when interest rates start to rise.

Would really like some advice before I talk to my broker as I feel he is being a little pushy for me to go ahead with the remortgage and Im not sure it makes sense. I realise the interest rates will rise, but everything I have read makes me believe this will not be until well into 2010 and the deal he suggests is only 2 years anyway.

Thanks in anticipation.

Julie

Peelerfart

joebmc wrote: »

I’m currently on Nationwide’s 2.5% SVR (BMR or whatever they call it). Think I’ll stay on it till at least the New Year but keep my eyes on the rates.
One thing that worries me is if say the BOE rates rise back up to 5% would that mean most fix rates would be around 9-10%?

Joe

I'm sorry I don't agree, It doesn't mean rates will be around 9-10%.

When rates were 5% , not a long time ago, fixes were not at that level,
and there's nothing to indicate that they would rise that high,unless you buy into the greedy banks argument.

There was a flurry of activity on this forum saying fix now rates are going to rocket. but as was stated above ,signs are it could be well into 2010.
If you can afford it and you aren't losing sleep stay on SVR (IMHO).

Jacka87

Though not an economist, my thinking is that the boe cant put rates up just now as it may make the recession into a w shape and the conomy would take a step back.

I think they will leave rates as they are for a while yet, mid 2010 lets say. However even then, they cant exactly say right now the rate is 5% again, they will have to increase it by 0.25% at a time at first and then maybe step it up to 0.5% steps. Once the rate has risen up for a steadyperiod they may then start taking bigger steps.

But my opinion is that we have maybe a year at this rate then we would here thesigns of its time to jump or at least get an alarm as it takes its first increase. At that point I would fix.

And the fixed rates should not be 10% when the boe is 5%, I personally think the BOE will rise close to double figures, maybe get into double figures but the fixed rates are based on longer periods and it is accounted for that fact. They should work out to be close to the average boe rate for that period (well generaly they will be higher, you are paying for the security).

jnofrills

Yeh, they are my kinda thoughts Jacka, which makes me believe to stay with svr and not take up the offer. New mortgage proposal is 2 yr fixed so would be looking to re-mortgage again at that time anyway, doesnt seem a bright move right now.

Surely if boe gets rate up into double figures, lenders follow and the housing market will become even more crippled instead of recovering... its gotta be a slow and steady increase surely?

Now feel confident to discuss this with my broker.

Thanks

b0rker

We are in a bit of a conundrum.

Our 2 year 6.99% fixed comes to an end on August the 31st. We have a NR Together with £100,000 mortgage and a £5,000 unsecured loan. We bought for £105,000 in August 2007. We have saved £20,000 between us since then and will use that to pay the mortgage down to £85,000. We have also paid off about £1,500 over the past 2 years so we are down to £83,500. We think our house is worth roughly £95,000 (the Inverness market is still very strong).

If we have to move our mortgage we can leave the £5000 secured loan with NR which would mean we have to rearrange owing £78,500 on the mortgage. If we can secure a new deal with NR (unlikely) then we will rearrange at £83,500.

To get on topic. The reason we are looking to rearrange instead of staying on the SVR is that we are both contractors and our current contracts run out in March 2010. So we will both have 6 months each left on our contracts in September 2009 which is when our current fixed is up. I do not fancy approaching lenders with any less time than this on our contracts.

The NR SVR is 4.79% which is pretty poor so the savings over a half decent 5 year fixed is not that much on a monthly basis.

NR SVR at 4.79% on £83,500 is £451.77 per month

If we can secure a 5.5% rate elsewhere on £78,500 we are looking at a repayment of £458.41 per monthThere is very little in it as far as monthly repayments go.
We are aware that the £5,000 that we will leave with NR will incur a high interest rate but we plan to pay that off within about 4 months.