Fixed rate deal ends in April 2010 - what do I do now?

Roberta1

My fixed rate repayment deal (5.89% for 2 years) expires in April 2010 and I will automatically move onto a base rate tracker set at 0.85% above B of E rate, with an offset facility.

That seems like a very attractive deal (1.35% at today's rates) so I am tempted to stay, but I am concerned, as many of us are, by what the B of E is going to do next year.

Before I make any decisions I would welcome all views, both pro and con!

Roberta.

waterwatcher

bump ..... i'd be interested in any views

opinions4u

Typical 5 year fixes are currently around the 6% mark, so you'd need a sharp jump in BofE rates to make you worse off with your tracker.

I would stick with your tracker - you already know the risks though!

Why not save the reduction in payments in an easy access account (e.g. The AA at 3.15%, or in to a cash ISA such as www.IF.com) and use the money set to one side to help you adjust to higher payments as and when interest rates rise (shop around for the best savings deals in April).

That way you never get used to spending the money created by your lower interest rates and can easily adjust as and when rates do go up (and if they don't rise for some time longer you will also have a nice lump sum saved up!).

Squish_21

I'd stick with tracker if i were you.

herbiesjp

Personally I would stay on the tracker

Penalty free and able to make unlimited overpayments

Even if BoE went to 5%, you would still be paying less than you are currently on your fixed rate

VfM4meplse

Agree with the advice to stick to a tracker rate, but be warned that interest rates are expected to go up from March 2010. Would thoroughly recommend an offset mortgage.

herbiesjp

BTW - what figures are you looking at?
Property value and mortgage amount would be handy

devon123

Hi - I hope you don't mind me jumping in on this thread Roberta... I am in a similar position and would really appreciate some advice!

My 2 yr fixed (5.79%) ends at the end of April next year. I know it's a long way off but I think you can 'book' rates in advance (for a fee of course) and I was considering this if rates look like they will rise in the early part of 2010.

My mortgage is currently for 98k. House is worth c.150k. I will drop down to the SVR (A&L - one of the worst!!) of 4.99% at the end of the deal. I am currently overpaying on my mortgage each month and estimate (using that brilliant spreadsheet that someone kindly posted) that my mortgage will be c. 95k by the end of April next year.

Any advice gratefully received, cheers :beer:

johnbhoy10

Hi-i booked a deal with RBS at start of summer of 4.69% for 5 years with £300 fee and added this onto the borrowing. This deal expired at start of october as i thought i'd being a bit hasty. My current deal with YBS is (4.99%) is up at end of february going onto svr of 4.99 funnily enough. London and Country came up with this Woolwich deal for me- BOE + 2.69% for term with ERC of 1% (about £800 in my case) for leaving in the first 2 years. However, i think i have found better with Firstdirect. They have a deal of BOE + 2.49% for term but there is no ERC. So i'm hoping to gain from low rates(even for a wee while) but if rates start to head north then i can jump ship onto a fixed at no cost.There are also no fees for this. That's the plan anyway.
My mortgage at end of feb will be £77000 against house value of £130000-135000. The Firstdirect deal is only available for LTV of 60% or less.


ps-The RBS was a good deal but it was costing me approx £2500 in redemption charges if i had gone for it.