Moving to Fixed Rate Mortgage?

Ali660

We have £65,000 outstanding on a house we bought 5 years ago for £185,000.

Our mortgage is with the Stafford Railway Building Society on a 3.49% SVR and we pay £560 pm with 12 years remaining.

With the news that mortgage rates could well go up in the near future would you recommend that we hop onto a fixed rate mortgage?

I have used a comparison site to look at 3 yr deals but the results are just spouting out 2 yr deals.

Your advice/opinions would be appreciated.

Ali

opinions4u

With the news that mortgage rates could well go up in the near future

What news was this? Merv?

Perhaps a capped tracker is what you need.

http://mortgages.firstdirect.com/cappedtracker/repayment

Wh05apk

Why are you looking at 3 years? to me if you want the security of a fixed rate, you need to be looking at longer term deals, otherwise take a tracker and save some money now?

A 3 year deal will be maturing probably just when rates are starting to increase, so you may then be stuck with much higher deals.

Ali660

opinions4u wrote: »

What news was this? Merv?

Perhaps a capped tracker is what you need.

http://mortgages.firstdirect.com/cappedtracker/repayment

Thank you for the link - it's good to see these rates aren't too high ;-)

Wh05apk wrote: »

Why are you looking at 3 years? to me if you want the security of a fixed rate, you need to be looking at longer term deals, otherwise take a tracker and save some money now?

A 3 year deal will be maturing probably just when rates are starting to increase, so you may then be stuck with much higher deals.

I would be interested in a longer term fixed but I'm having trouble finding good comparison sites - could you recommend any?

opinions4u

www.moneyfacts.co.uk would be a good starting point.

Co-op, HSBC, First Direct, Yorkshire Building Society - not comparison sites, but they've all done 5 year fixed rate below 4% in recent months. There may well be others at your LTV.

Wh05apk

Unfortunately we use our own system, so can't recommend any consumer sites, but look at Coop/Brittannia 5 yr 3.59% no fees, or Nat west 3.79% with £250 cashback, there are lower rates out their but these are probably the best for you given your mortgage size, assuming you meet theri criteria.

JimmyTheWig

Agree that a long term fix is the safest bet.

Consider reducing your term, too.
If you know that your rate isn't going to go up in the next 5 years, then consider what you can afford to pay each month and you can match your term to that figure safe in the knowledge that it won't go above that.
If that means that you can get a 5 year fixed rate with a 10 year term then whatever rates are in 5 years time it should be manageable. The more you can pay off, the less effect a rate rise will have.