Dilemma - 3yr fixed or 5 yr fixed

whist

Hi peeps,

Ive just seen a great deal on YBS mortgages. I am currently on HSBC SVR since its been difficult to get a 90% mortgage at a decent rate. I have been watching the market for a while and overpaying slightly and it looks like I can get an 85% mortgage.

I am torn between fixing for 3 or 5 years as well as whether to go for a rate with fees reduced but higher rate or lower rate with higher fees.

I have put info in some calculators to compare the rates with and without fees but I am now torn between a 3 (3.84 around 550 fees + legal costs) and 5 year fixed ( 4.24 + 1500ish fees + legal).

I plan to keep overpaying so i reckon in 3 yrs time , if house prices have gone up , i may be in 75% range . At this LTV i may be able to get a lower or similar rate. It would also work out to be about £70/month cheaper on the 3 year deal - around 2500 in 3 years. ive considered that i'll have to pay fees etc again in 3 years rather than 5 but I'm really torn on whether to gamble that ill be able to get a better deal in 3 years or play safe.

I am leaning towards the 3 year fixed. Advice welcome.

dimbo61

I have just finished a 5 year fix with YBS and now on a tracker
I also overpaid and reduced my debt and both rates are better than I was paying for 5 years!
Your choice but do you plan on moving any time soon ?
With a 5 year deal could you have the LTV below 60% in 5 years ?
Lending with YBS is tough so you may not get the deal you want

whist

I dont plan to sell the property anytime soon. I do not have any plans to move at the moment but it is a possibility that i may move to a bigger property .

Can you explain what you mean by lending with YBS is tough?

dimbo61

Best rates on the market at the moment so like the HSBC tracker at 1.99% over base so 2.49% they can cherry pick the best customers
Have a look at the affordability calculator to see how much they will lend you and good credit score with no defaults, ccjs etc