Is it time to fix your mortgage?

IveSeenTheLight

undetterred wrote: »

Seems to be just the MSE FTB'rs that are struggling?

I wonder if locality is the issue.
If it is, maybe they should blame their parent for where they were born instead of when they were born

Thrugelmir

IveSeenTheLight wrote: »

Certainly seems that mortgage companies are not factoring in rates going rapidly high in the coming years

Or people are not borrowing. As mortgage lenders need to lend money out. Overnight deposit rates are extremely poor.

IveSeenTheLight

Thrugelmir wrote: »

Or people are not borrowing. As mortgage lenders need to lend money out. Overnight deposit rates are extremely poor.

surely it would not be prudent to lend out on a 10 year fix @ 5.29% if they thought that rates would be higher over that term.

Batchy

IveSeenTheLight wrote: »

surely it would not be prudent to lend out on a 10 year fix @ 5.29% if they thought that rates would be higher over that term.

Your probably right...

My plan is 10 year fix, and overpay like hell...
Get it paid off, then over the entire duration of the mortgage... no shocks.

I trust no one, and want to be in control of my own destiny. I don't like the idea of goal posts moving.

They should introduce 25 year fix's too.

The Idea of people refinancing every 2 years, plays so into the hands of the banks with arrangement fee's etc, its quite scandalous.

Heyman_2

Batchy wrote: »

They should introduce 25 year fix's too.

Before the Credit Crunch, HSBC were doing a 25-year fix at 5.49% - could have been worth a punt!

Still happy on my +0.79% Lifetime Tracker for the time being.

Thrugelmir

IveSeenTheLight wrote: »

surely it would not be prudent to lend out on a 10 year fix @ 5.29% if they thought that rates would be higher over that term.

Money lent at fixed term rates is back to back. Money advanced = money deposited. Lenders are guaranteed a margin over the term of the fix. There's no risk for the lender. That's why the products carry hefty ERC's to discourage early exit.

Lenders also only have limited amounts of money available at headline rates. Similar to a supermarkets best offers. Draws the punters in. As gets good free press coverage.

PasturesNew

I'd rather pay a higher rate of interest on a smaller sum borrowed, than have low interest on a much larger sum.

£65,000 at 10% is £590/month (repayment)
£100,000 at 5% is £584/month (repayment)

Same amount per month, but it's easier to repay £65k early than £100k.

Harry_Powell

Batchy wrote: »

Your probably right...

My plan is 10 year fix, and overpay like hell...
Get it paid off, then over the entire duration of the mortgage... no shocks.

I trust no one, and want to be in control of my own destiny. I don't like the idea of goal posts moving.

They should introduce 25 year fix's too.

The Idea of people refinancing every 2 years, plays so into the hands of the banks with arrangement fee's etc, its quite scandalous.

I don't think you can make significant overpayments when you're on a fixed rate deal. Many restrict you to upto 10% of the mortgage balance and some (HSBC) restrict you to 20% of the normal monthly repayment amount.

Fixed rates are playing into the bank's hands too - you will always pay more on a fixed rate mortgage than if you had a low tracker. Banks aren't going to come out with a mortgage product that benefits their customers more than themselves.

chucky

Harry_Powell wrote: »

I don't think you can make significant overpayments when you're on a fixed rate deal. Many restrict you to upto 10% of the mortgage balance and some (HSBC) restrict you to 20% of the normal monthly repayment amount.

Fixed rates are playing into the bank's hands too - you will always pay more on a fixed rate mortgage than if you had a low tracker. Banks aren't going to come out with a mortgage product that benefits their customers more than themselves.

my 4.69% 5 year (4 years left) with the Halifax only allows me to pay 10% per year of the mortgage outstanding.

a bit of a pain but at least it allows to make investments plus my ISA to give me more than what i'm paying on my mortgage...

puddy

i agree with that, but is about what suits. im reading this green with envy as usual. our fixed rate now has about 7 or so years left to run (someting like that anyway) at 4.89, it was a 10 year fixed. after that, theres another 5 years of mortgage left. we're not in a position to make overpayments at the moment but i think its something like 10%

but,,, despite wishing i had a lower rate and paid less, i have been paying the same mortgage since it started and will continue to do so for another 7 years. yes its more than others, but i know how much it is, i know how much i need and if we ever can over pay, i know exactly how much i would be overpaying each year/month.

im satisifed with that