Mortgage fixed rate ending!

gloria22

A bit of advice needed please! Out fixed rate Mortgage of 6% which we have been paying for 5 long years comes to an end on 31st July. It with come down to 2% above base rate so with be 2.5%. What do I do? Do I fix it again at 4% which my current lender is offering?

marathonic

The banks would LOVE you to fix again because your 2.5% rate is so good.

DEFINITELY stick with the 2% above base rate product but continue to pay what you're currently paying at 6% (assuming it's affordable).

This will allow you to decrease your mortgage balance and minimise the impact of any rate rises down the line.

For a 4% product to be worthwhile, the BOE base rate needs to rise above 2% which most people agree won't happen for at least 2-3 years and possibly longer.

gloria22

Thanks, thats really god to know! No wonder my current lender is pushing us to fix it!!

dimbo61

One of the papers today stated that rates could stay low 0.5% for the next 5 years
But they also said Man U would win the league this year !!!!
If you have no other debts then stay on the Tracker deal and overpay

nuttybabe

Thank you so much. Our fixed rate is coming to an end and we can either go on the 2.5% rate saving us £140 on waht we are paying now or the cheapest fixed rate for 3 years which will be an extra £30 more a month than we are paying now and will be 5.89%.

So I think base rate will be best

dimbo61

Stay on the BMR at 2.5% and
OVERPAY OVERPAY OVERPAY and dont forget if you can OVERPAY !!

Thrugelmir

dimbo61 wrote: »

Stay on the BMR at 2.5% and
OVERPAY OVERPAY OVERPAY and dont forget if you can OVERPAY !!

Wise words. As interest rates won't stay low indefinately.

kidmugsy

I disagree. Go onto the 2.5% and save the reduction in payments in a Cash ISA each at (say) 3.1% or a bit more. Use that cash, or some of it, to pay down the mortgage only when the mortgage interest rate exceeds the rate on your ISAs.

dimbo61

If you get used to pay £XXXX amount each month for your mortgage payment then thats the MORTGAGE
Save extra into cash ISA,s each year £5640 per annum now that is a MSE person.
By keeping the payment static you wont notice if mortgage rates do go up as you are already overpaying