Advice abuot fixed mortgages

BLC22

Hi,

Was after opinion and advice if possible.

We are in a fixed rate 5 yr mortgage that is due to finish shortly, the rate has been 4.79%.

The deal was after the fixed rate finished, we would be on 0.5% above the BofE base rate for the reminder of the term of the mortgage (i.e. based on current rates our interest would be 1%).

Given that we have a seemingly good deal, I am undecided whether to tie into another fixed rate, or hold our nerve given that .5% above the BofE base rate is such a good deal.

The way I see it is that if we tie into another fixed rate, then when that comes to an end, the remaining term of the mortgage will be no where near as such good terms as we have now!!

Can anyone guide me?

Thanks

BLC22

c0rneL

the real answer is, depends on what is going to happen with interest rates.

If they will go up quite sharply, then probably will be best if you secure the best fixed deal sooner rather than later,
but on the other hand if they will stay low for a long period of time you loose

I built a scenario, and in my calculation I tend to be prudent and I will choose the best fixed deal available -- internest rates historically are no way near what they are right now -- and I suspect that they will not stay low for a lot longer

getmore4less

I would stick with base + 0.5% and overpay at least at the level I had been paying.

You would need to consider the risk of rate rises to your situation.

LTV(what alternative deals can you get), income surplus, future plans, the big unknown interest rates.

dimbo61

Who are you with and does the mortgage reverts to BOE + 0.5% at the end of the fix ?
As others have said save the extra money into either cash ISA,s or regular savers and consider overpaying the mortgage with the money saved when rates start to rise.
See what your existing lender has to offer you in the way of a long term fix

BLC22

hi,

thanks for your responses and comments. Are current mortgate is with the Chelsea, to be honest, they were a nightmare when we ported our mortgage across when we moved house, so I doubt that they will have any good deals on offer when our fixed rate ends.

The mortgage does rever to BofE + .5% when the fix ends, which is later this year, and that remains for the life of the mortgage.

To have such a good term for the remainder of the life of the mortgage, makes me inclined to stick where I am, and like you say over pay. From what I can see, if we tied into another fixed rate now, then the deal when that fix ends, is nowhere near as good as the .5% I have now.

bacard1

I would stick with the tracker, and overpay as suggested above. You could always look at a fix later on