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Risk of deflation with interest rate hikes, should I fix my mortgage?
redboy1
Posts: 199 Forumite
Just seen this on the news. At the moment I'm on nationwide base rate which is 2% above the bank of England base rate.
I think I could get a 10year fixed @ 3.04% with no fee or 2.94% with £999 fee.
Should I be jumping on this?
I think I could get a 10year fixed @ 3.04% with no fee or 2.94% with £999 fee.
Should I be jumping on this?
0
Comments
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What interest rate hikes? Mark Carney is talking about the possibility of *reducing* the base rate if required.0
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If there is deflation there will be no interest rate rises.0
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Alternatively.
http://blogs.reuters.com/macroscope/2014/06/17/weak-uk-inflation-casts-doubt-on-interest-rate-hike-this-year/
You are wise to keep an eye on your situation and options but should be cautioned against tying yourself into a 10 year mortgage product off of the back of UK press drivel.I am a Mortgage Broker
You should note that this site doesn't check my status as a Mortgage Broker, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.0 -
Alternatively.
http://blogs.reuters.com/macroscope/2014/06/17/weak-uk-inflation-casts-doubt-on-interest-rate-hike-this-year/
You are wise to keep an eye on your situation and options but should be cautioned against tying yourself into a 10 year mortgage product off of the back of UK press drivel.
Even so, if rates rise just 0.5% that would put me level with the 10y fixed rate. I still have 25y left to go so that 10y fixed would take a big chunk out my mortgage at decent rates.0 -
Carney said that UK would experience negative inflation due to oil price fall and that the BOE would look through this and that the next rate move is more likely to be a raise rather than a lowering.
10yr @ 3.04 is not bad when 10 yr gilt is 1.68 - 150 basis points is a normal spread over 10 year gilt for a fixed rate
I've recently fixed 5yr @ 3.15 so not as good as what you have been offered - I don't see rate rises this year but wanted to hedge myself against rises likely to come in 2016/2017.0 -
How often does the BOE review the interest rates / have a meeting to decide what to do with them ?0
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