Sense check

CAN1976

This month my 5 year fixed rate (4.99%) with Nationwide ends. Due to house value erosion, my equity is still pretty sucky (approx 12%). The fixed term deals available to me are in the 7% range, however when my deal ends I will be falling onto a rate 2% above base rate. I am thinking my best move is to do that and continue paying my current monthly payment to pay down the mortgage, improving my equity position and reducing my exposure to rate changes. Given that it will take a rate increase of 4.5% to get me to where the current fixed rate deals are, does this plan sound reasonable?

Senior_Paper_Monitor

Yes, AND take the opportunity to overpay to improve your LTV !!!!

CAN1976

I intend to pay the same amount I have been doing for the last 5 years (£670), which will be an overpayment of about £120 a month on a £550 payment.

Senior_Paper_Monitor

Exactly - sounds perfect (even more perfect if you can squeeze it up a bit) !