First time buyer- advice needed please!

Tam84

Hi everyone,

I'm a first time buyer & I have recently had my offer accepted on a house.

I've been looking at last minute mortgage offers just to see if I could beat the deal I found originally & the top two that have come up (through mortgage brokers) are;-

3yr fixed rate at 4.84%

& 5yr fixed rate at 4.99%

I found out about the 3yr fixed one first & think it's a good offer, but would it be in my interest to go for the 5 yr fixed rate at the slightly higher percentage? Or would it be better to chose the shorter term one so that I could review the rates after 3 years & change accordingly?

Any advice would be much appreciated!!! Thank you!

(The quoted rates are based on a 15% deposit)

GMS

If you have concerns over a product why not speak to your broker?

If you prefer the security of a longer fixed term then the 5 year deal looks to be good, for not much higher a rate, although you have not mentioned if there are application and valuation fees etc.

If you prefer to review after 3 years then go for that. Problem is that nobody knows where interest rates will be in 3 years. You may find yourself wishing you had gone for 5 years, but equally could find yourself 3 years into a 5 year fixed wishing you had chosen a 3 year deal!

It really is a personal choice.

herbiesjp

Be careful with quotes/finding deals.

Just because you fit the 15% deposit, are you sure you will fit all other lender criteria i.e affordability?

Then the choice is yours as to whether you want to go for 3 or 5 years - the difference in rate is minimal (can't tell the difference it makes on the repayments as you have not posted any figures).

However if you have a low mortgage, the actual rate is less important than the fees attached to the mortgage. So that would impact also on whether it is better to re-mortgage and incur those re-mortgage costs in 3 or 5 years.