Nationwide BMR - still safe?

allymac_2

I have 17 yrs left to run on a mortgage of £25,000 and have been enjoying the BMR of 2.5% for the last few years since my previous rate ended. I am widowed so can't afford to risk having the repayments shoot away up if the rates rise. Should I apply for a fixed rate now? Doesn't seem worth my while for such a small mortgage what with the arrangment fees etc.

Thrugelmir

If you can afford to, make overpayments on your mortgage. You are unlikely to better the rate that you currently have. At some point in the future interest rates will rise. So reducing your debt will minimise the impact of this.

allymac_2

Thanks, I wish that were possible but both my kids are getting married in the next 3 months so you can imagine that, with outfits and wedding presents for them both, overpaying the mortage right now is just not possible on my one wage. Looking forward to having extra money when they're gone though to pay off my credit card debt, redecorate etc. Am thinking it probably makes more sense to get rid of the credit card debt before overpaying on the mortgage anyway.

kingstreet

You are currently paying around £150 per month.

An increase in Nationwide's BMR to 5% would see your payments increase to £182.

Such increases should happen at a slow enough rate for you to consider switching and to effect a move to a fixed rate without it costing you too much in the intervening period.

There are a number of fixed rate options where there are no fees payable and all the transfer costs are covered for you. An offer with a small cashback attached would probably suit a mortgage around the size of yours.