Should I switch from my Nationwide Base Rate?

fuzzylogic81

Hi all,

I am pretty clueless when it comes to this, so any help is much appreciated!

For the past few years I have been on the Nationwide variable base rate tracker, where it is guaranteed to not be more than 2% above the bank of england interest rate.

Yesterday I was all set to change to a fixed rate deal, for more security etc, in view of the likelihood that interest rates may rise soon. However, after speaking to an advisor, he informed me that if I do switch, the mortgage I am currently on will no longer be available (presumably because its so low). In view of this, it made me think that I should stick with what I have.

What is the general consensus guys?

Should I stick to my current mortgage deal, where the interest rate is 2.5% (but will most probably increase soon) or fix to something around the 3.49% mark for 5 years?

Thanks in advance for any help

TrickyDicky101

Mortgage amount outstanding? Income?

I wouldn't give up the BMR but if worst came to worst, a mortgage rate of 7% wouldn't negatively impact my standard of living so I can afford to take risks.

Thrugelmir

Stick on the rate you currently are and overpay.

michelle2008

Interest rates will go up. Overpaying is a definite must in the current climate.

This is a decision only you can make though - are you having sleepless nights about higher rates - if so you might find the slightly higher cost of fixing long term is worth it.

Thrugelmir

michelle2008 wrote: »

if so you might find the slightly higher cost of fixing long term is worth it.

Fixing is only a temporary solution. Losing the 2% above base rate may prove expensive in the longer term.

michelle2008

Thrugelmir wrote: »

Fixing is only a temporary solution. Losing the 2% above base rate may prove expensive in the longer term.

Agree - all depends how long you have left on the mortgage and your tolerance for risk.