Co-operative deals - fix or capped tracker?

sundin13

Hi All,
I'm in the process of remortgaging, and was planning on going for the co-op's 5 year fixed at 4.74%, which I think is a pretty good deal. However I've just noticed that they've launched a 5 year capped tracker (currently 2.99%, capped at 5.99%). I'm now not sure which of these to go for - if I overpay the tracker to the payment that I would have to make for the fixed rate would I be better off in the long run? Thanks in advance,
S13

CloudCuckooLand

It is a guess at what speed rates will rise. As is how far above the Fixed deal rates will get to, pushing the Tracker to its cap, and for how long.

The 1.75% gap might take a year, perhaps more, to close. Once going in that direction, it could be a further 12 months before you hit the cap, and sit there for 3 years. Or it could take longer to rise, and not hit the cap.

Overpaying gets you ahead, but the pattern of rate movements will vary the extent of gain, and whether that remains the case.

Toss a coin?

sundin13

Yes, I guess you're right. I suppose I have to make a decision based on when and by how much I think the rates are going to rise. I got badly burned by a five year fix once in the past (2000 - 7.9%), so I'm a little reluctant to commit, even though I do think it's a very good deal.

Much appreciated

S13