Fixed Rate or Offset

Big_Bob_999

Been in touch with London and Country as my deal is up soon, c&g 4,39%.

Looking for £153k against £290k house, 8yr term approx £2k per month

Partener and I both high rate tax payers, and should get about 30k a year in bonuses on top of normal earnings.

OPtions given are
Halifax 5.44% 2 yr fixed, £1045 fees
Woolwich 0.18 % tracker 5.68 % no fees full term
IF offset .19% 5.69% 2yrs no fees

Like idea of offset as salary when goes in reduces mortgage and spend on c/credit mainly so in longer, and also as recieve lump sums can offset against mortgage and not limited to 10% overpayment a year.

However now been told halifax removing product tomo, so looks like rates going to increase. So is it better to fix?

Any advice any one of what to go for??

mightymouse

Hi

The benefit of an Independent Mortgage Broker is the tools at his disposal of which one is a daily update electonically (internet based) of most lenders in the UK with rates details and suitability or otherwise of the lender or package.

You should have a meeting with all the options available for any given day and narrow the choice through selection.

On reflection you may also consider an Independent Financial Adviser if you wanted to look at the bigger picture ie savings,pension and tax implications.

JoeK_3

Mortgages above £53,000 are interest rate sensitive and your mortgage of £153,000 will be extremely sensitive to a reduction in rates, as a 0.25% diferrence would mean £382.50 less per year.

Looking at your choices, the strategy that you seem to have adopted is a two year one and it may pay you to look at a longer term, as it's difficult to see what you will be going into in two years time when your deal has finished.

To satisfy both the short term and longer term, you may want to consider a five year capped rate, as you would secure a ceiling on your payments and you would also benefit from interest rates going down during this period.

JoeK

guy999

JoeK
an you maybe point me in direction of a capped mortage where yu can overpay by 10%, or fixed 1yr tracker remainder

As i believe rates will continue to increase then drop over my next mort period