Switching for a 10 years fixed rate? Not only for money

BBG2015

Hi there,
New to this forum.
I am 3 years into a 5 years fixed rate @ 3.79% with around £115,000 left to pay (and a hefty £5700 ERC even if I stay with my lender Nationwide) BUT I am fearing coming out of the 5 years fixed rate in 2 years time and I am tempted to re-mortgage now for peace of mind. I have done my maths and I am not saving anything if I add the ERC to my monthly repayments over the course of 10 years. The Nationwide 10 years no fee fixed rate is currently 2.94%. I thought about switching now (i.e. before the general elections) but the ERC really are putting me off so I would prefer to wait a bit so the ERC decreases. If anyone either can give me their opinion/advice (or better still have a crystal ball!), I'd be much grateful.
Thanks
PS: my property bought £185K 10 years ago is now worth at least £320K; ideally I'd like to move in the next 5 years to get an extra room

amnblog

What do you imagine is going to happen if you don't fix to 2025 now?

Thrugelmir

Will the NW allow you to add the ERC to the new mortgage?

A question that needs answering.

If you are looking to move in the future then overpay your mortgage now and start saving interest. Also you'll be building equity.

BBG2015

To amnblog'
What do you imagine is going to happen if you don't fix to 2025 now?' much higher interest rates than 2.94%? WWIII? I think times are uncertain so I don't know what to expect. What do you think may happen?

To Thrugelmir: '
Will the NW allow you to add the ERC to the new mortgage' no, money will come from my saving. Tried to negotiate a lower ERC but they didn't budge

PS: don't know (yet) how to do quotes! Never got on a forum that much before, sorry

getmore4less

£115k @3.79% ERC £5700 2 years to go

10y fix 2.94% ( moving in 5y make this a new risk)

You don't say what full term but lets go with 20y

1. £115000 @ 3.79% £685pm
2. £120700 @ 2.94% £666pm

pay £685 on both after 2 years

1. £106990
2. £111090 still £4100 down.

After 10 years
2 £66470

in 2 years you need a switch to a rate below 3.59% what are the 5 year rates like now will they go up to that?

Jhoney_2

BBG2015 wrote: »

To amnblog'
What do you imagine is going to happen if you don't fix to 2025 now?' much higher interest rates than 2.94%? WWIII? I think times are uncertain so I don't know what to expect. What do you think may happen?

To Thrugelmir: '
Will the NW allow you to add the ERC to the new mortgage' no, money will come from my saving. Tried to negotiate a lower ERC but they didn't budge

PS: don't know (yet) how to do quotes! Never got on a forum that much before, sorry

Go to the posters response on the thread that you wish to reply to and click on the quote bubble at the bottom.

getmore4less

probably better to model
Stay put 2 years with 3y fix to follow
against
a new 5y fix with the penalty

to tie in with a possible move.

whats the max penalty free overpayment pm on the current deal
(to model overpayments as you are paying the fees up front)

BBG2015

Jhoney wrote: »

Go to the posters response on the thread that you wish to reply to and click on the quote bubble at the bottom.

Got it, thanks

BBG2015

in 2 years you need a switch to a rate below 3.59% what are the 5 year rates like now will they go up to that?[/QUOTE]
So I should wait and switch then rather than now (if available, which is rather hypothetical)? Best 5y fixed now (no fee) is 2.49%

When I first got a mortgage interest rates were 4.59% and we thought they were great! (that was the deal before the one I am on now)

Wouldn't it be safer (even if I just break even) to switch now for 10 years?

BBG2015

getmore4less wrote: »

probably better to model
Stay put 2 years with 3y fix to follow
against
a new 5y fix with the penalty

to tie in with a possible move.

whats the max penalty free overpayment pm on the current deal
(to model overpayments as you are paying the fees up front)

I am after a 10y not 5y
I can repay £500/m without penalty

pjread

BBG2015 wrote: »

I am after a 10y not 5y
I can repay £500/m without penalty

Why are you after a 10 year fix, if you are expecting/planning to move in 5 years?