5yr or 3yr fixed rate??

SuperSaver123

Thanks Dimbo61.

The thing is that if I go for 2 years, I am gambling a bit as the rate may go up then (I am hoping that it won't until spring time 2015) but:

1. as the interest of 2 yrs is lower, I can overpay the mortgage now and benefit from it immediately as interest is calculated daily.
2. In 2 years' time I can look at rates for 60% LTV which means I may have even better choice.

I am still slightly unsure but I think even if interest rates go up in 2 years' time, I will benefit from different choice of rates (60% LTV) and this outweighs the risk of interest going up.

Hmmm.... (still contemplating)

Thrugelmir

SuperSaver123 wrote: »

2. In 2 years' time I can look at rates for 60% LTV which means I may have even better choice.

What is your mortgage balance projected to be? At a a point. The cost of remortgaging , fees etc. Makes the move uneconomic to another lender.

So you may be better off with the security of a 5 year fix.

Zero_Sum

SuperSaver123 wrote: »

But if I had to choose 2 or 5 yr at above rates which one would say is better?

I have other commitments at the moment and don't want to leave my mortgage for another month on the old rate so kind of need to make a decision with the current lender. Not the most moneysaving, I know but sometimes we have to choose and not switching and looking at other lenders will lose me less money than neglecting the other stuff I have going on at the moment. This is the least of bads i have to chose from.

me personally, for the sake of 0.3%, I'd opt for the 5 year given the additional security. But as others have said, you can get better rates elsewhere

dimbo61

Maybe its a sign I am getting very old but I remember paying 14/15% interest on my mortgage at the end of the 80,s so when you talk of 3.54% and 3.84% I still think both deals are very low.
I have worked hard since we took out what for us was a huge mortgage 7 years ago, at the time we wanted the security of a 5 year fix and also managed to overpay very month ( holidays in spain and not florida / cruises on the canal and not round the world)
Good Luck in your mortgage free dream