What do you think mortgage deals will be like in two years time?

JimmyTheWig

Ok, crystal ball time.
Interested to know what people think. Obviously not looking for advice as no-one knows.

Pretty much everyone agrees that interest rates can only go up from this low that they are in. But by how much are they likely to have gone up by in two years?
I'm talking a decent deal, here, rather than the Bank of England base rate.

E.g. I was recently offered a 2.49% 2 year fix with no fees from Santander. If I approached them in two years time, how much higher do you think the rate I'd be offered would be?

mrginge

More than 1% higher

I'm afraid your poll is bad.

Someone who thinks they will go up by 1.25% ticks the same box as someone who thinks they'll go up by 3%.
Having an 'exactly 1%' box is a waste of time.

I confidently predict that you'll end up with 90% of people ticking >1% and it will have taught us absolutely nothing.

Cheers!

Thrugelmir

More than 1% higher

JimmyTheWig wrote: »

I'm talking a decent deal, here, rather than the Bank of England base rate.

Base rate will influence lending rates going forward. The market has fundamentally changed to that developed 10 years prior to the crash.

Lenders will eventually have no Funding for Lendiing money available to offer headline grabbing rates.

JimmyTheWig

Exactly 1% higher

mrginge wrote: »

I'm afraid your poll is bad.

Thanks!

Someone who thinks they will go up by 1.25% ticks the same box as someone who thinks they'll go up by 3%.

Correct.

Having an 'exactly 1%' box is a waste of time.

Someone's already ticked it!

I confidently predict that you'll end up with 90% of people ticking >1% and it will have taught us absolutely nothing.

That would teach me everything I need to know, as it happens.

mrginge

More than 1% higher

JimmyTheWig wrote: »

Thanks!

No prob. Always happy to help.

sheffield_lad

More than 1% higher

rates 2-3% ish higher but.....the margins on the deals 0.5% less.

JimmyTheWig

Exactly 1% higher

All very interesting.
Thanks for the responses and votes so far.
Will update with why I'm asking tomorrow.

Thrugelmir

More than 1% higher

JimmyTheWig wrote: »

Will update with why I'm asking tomorrow.

Can't wait to find out. :j:j:j

mrginge

More than 1% higher

Thrugelmir wrote: »

Can't wait to find out. :j:j:j

I am gutted.
Booked in for a lobotomy tomorrow so i guess i'll never find out.

:mad:

JimmyTheWig

Exactly 1% higher

I sense a tad of irony here, but I'll tell you anyway...

Mortgage is in two parts.
Part A is fixed for 4 years at 2.99%
Part B is fixed for 2 years at 2.49%
My plan is to take another 2 year deal for part B when this one runs out.

I'm allowed to make overpayments of up to 10% of the balance in any calendar year. I'll be making an overpayment soon.
But which part do I overpay?
If my deal in 2 years time is a 3.49% fix (i.e. rates have gone up by exactly 1%) then it doesn't matter which part I overpay now - I'll either be saving 2.99% for 4 years if I overpay part B or I'll be saving 2.49% for 2 years then 3.49% for 2 years which averages out to 2.99% (possibly a little lower if you include compound interest, but I would guess that the difference is tiny).
If the next rate is more than 3.49% then I'd be better off overpaying part B now.
If the next rate is less than 3.49% then I'd be better off overpaying part A now.

Personally, I think a 1% increase in two years is about right.

Interesting that the consensus is with more than 1% increase, in which case I'd be better off overpaying the part with the lower current interest rate.

amnblog

I think we can describe you as a 'forward planner' Jimmy!