tracker v fixed

snaggle79

hi all, first post so be kind!

what would most people take with regards to mortgages now? fixed or tracker? We have been quoted for both and there is approx £80 difference per month between them

We have always gone for fixed but £80 is a huge saving however it worries me incase the tracker shoots up over the next 2 years

Thanks

Moby_Tide

How long is the Fix and how much change in rates would render your £80 saving null and void

snaggle79

hi

its fixed for 2 years however this has a fee of approx 2k, i just wondered what peoples thoughts on fixed v tracker are

amnblog

2K is a big fee (unless its a BTL deal)

it is a large lending requirement?

snaggle79

amnblog wrote: »

2K is a big fee (unless its a BTL deal)

it is a large lending requirement?

sorry, i dont undestand what you mean

dimbo61

IE is this a Huge mortgage ? £200K plus or is this for a Buy To Let property?

snaggle79

hi
its a £150k mortgage
Thanks

amnblog

so you are looking to pay a 1.3% fee on a two year deal.

this means you need over 0.6% margin between the two products to cover the fee

batchoy

Fixed vs Tracker is really down to personal preference, your personal view on how interest rates will move and how easily you think you will be able to cope with changes in mortgage payments.

Personally I have stuck with tracker mortgages over the last 23.5 years and remortgaged when the tracker period came to an end. Yes your mortgage repayments can fluctuate from month to month, but my view is it is easier to cope with small fluctuations resulting from a tracker rather than the big step changes that can occur when a fixed period comes to an end and at the moment BoE rates are more likely to go up than down. I know a couple of people swore by fixed rate mortgages due to the fixed monthly payments and looked down on me as my payments increased month on month but then all but lost their homes when their fixed periods ended in the middle an interest rate peak and they suddenly found that their payments were about to double overnight.

Its probably something that we are not going to see again but when the bottom dropped out of the BoE rate my tracker my repayments went the same way, enabling me to over pay to the extent that I go mortgage free at the end of the week and 18 months ahead of schedule, meantime colleagues are still paying very high pre-crash fixed rates.

snaggle79

batchoy wrote: »

Fixed vs Tracker is really down to personal preference, your personal view on how interest rates will move and how easily you think you will be able to cope with changes in mortgage payments.

Personally I have stuck with tracker mortgages over the last 23.5 years and remortgaged when the tracker period came to an end. Yes your mortgage repayments can fluctuate from month to month, but my view is it is easier to cope with small fluctuations resulting from a tracker rather than the big step changes that can occur when a fixed period comes to an end and at the moment BoE rates are more likely to go up than down. I know a couple of people swore by fixed rate mortgages due to the fixed monthly payments and looked down on me as my payments increased month on month but then all but lost their homes when their fixed periods ended in the middle an interest rate peak and they suddenly found that their payments were about to double overnight.

Its probably something that we are not going to see again but when the bottom dropped out of the BoE rate my tracker my repayments went the same way, enabling me to over pay to the extent that I go mortgage free at the end of the week and 18 months ahead of schedule, meantime colleagues are still paying very high pre-crash fixed rates.

Thanks for the feedback, i have always fixed however the best deal seems to be the tracker however i wanted other opinions.

Dan-Dan

The tracker will obviously be the better deal because your paying for security and peace of mind with a fixed , that`s the whole point