When would be a good time to fix?

hufc2002

Hi all

I have been on my lenders variable rate of 2.49% for 26 months now and wondered when a good time would be to fix or am I better of staying put for now?

Original Mortgage - £107,000
Current House Value - £95,0000
Outstanding Mortgage - £88,000

We have also been overpaying by £220 per month.

Cheers

pjread

At over 90% LTV I'd be amazed if you could beat 2.49%, that looks like a very good SVR to me - quite an 'old' mortgage is it?

If you do jump, be careful of any reversion rate. Personally in your situation I'd probably hold tight unless you have savings to reduce that LTV with.

hufc2002

Thanks for the reply.

We bought at the height with a 100% mortgage on a 5 year fixed rate of 6.39%. We have since been on the lenders variable rate of 2.49% and have been overpaying for 2 years therefore our payment hasn't changed.

I do have circa £14k in savings.

amnblog

If you can overpay, you can handle a base rate rise.


You can fix when you start getting nervous about future prospects.

hufc2002

Yes we are overpaying because we can afford to and because our house is worth approximately 10-12k less than what we paid for it therfore trying to build up some equity.

We do plan to move but this will be in approx 3-5 years.

pjread

So you can clearly afford 6%+ as you've done so for 5 years, I'd definitely stick with what you've got for now if I were you as it'd probably cost you at least an extra 2% given your LTV.

Whatever anyone says, the path to a 2%+ base rate rise isn't going to be overnight IMO. Maybe over those 3-5 years, but you'll still be well up (and presumably at a much better LTV, so able to get a relatively decent rate at that point)