svr or fixed?

hellsbells120780

Hi, I am re-mortgaging my flat at the moment. I have an offer from HSBC for a SVR variable mortgage and an offer from my present lender for a fixed rate product. The variable rate product percent is 3.84% and the fixed rate product is 5.19%. Both are for two years. But it says the costs for comparison are 4.0% and 6.0% APR respectively. I don't really understand why. So my query is would the HSBC put up their SVR 1.5% like the Bank of Ireland and is there a way to see how HSBC have changed their SVR over the last few years? Is the Bank of England base rate going to go up a lot soon? I need to decide between a fix and a variable but after what the Bank of Ireland did this week I'm now scared of the variable rate even though it is lower. There are no fees on either.

Thrugelmir

If interest rates are a concern. Then budget on reducing the debt as fast as you can. As its this that really makes an impact. The lower the debt you owe the less your repayments will increase in the future.

Interest rates are heading upwards over the next few years. That's a certainty. What they are going to stabilise at no one knows.

ACG

Is the SVR linked to the bank of england base rate?
If not then yes they cut put the rate up whenever they like.

My personal opinion is that for a 2 year deal i would go for the variable rate, the reason being is that i cant see the rate going up by 1.5% in the next 2 years....obviously nobody knows the future so its a game of chance but even if it does go up 1.5% in 6 months, youve still had 6 months at a lower rate.

This is an opinion only, im not advising you to do either.