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Fixed Rate coming to an end

We took a 5 year fixed rate out to buy our house which seemed like a good idea at the time as no-one knew the interest rate would stay so low for so long. Our rate is coming to an end soon and our current provider is offering a 2 year fixed at 2.54% which will be £150 less than we are currently paying, or a 5 year fixed at a slightly higher rate that will be around £90 less. There would be no fees or surveys etc. to be done, so from a hassle perspective this seems like a good option, but I am not sure if we would be better off looking around. Are there likely to be any better offers round just now, or should I jump at this offer?
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Comments

  • What is your LTV? Do a basic mortgage comparison to have a look at rates but bear in mind additional fees.
    Do you want another fix or are you considering variable options , you could ask them for their current rates also.
    I wasn't expecting rates to stay low for so long but now I think it may be another while before they go up, a year at least so personally I don't think a 2 year fix is worth it unless the rate is amazing. We decided to go for a 10 year fix but I know that is not for everyone.
  • superdon
    superdon Posts: 317 Forumite
    Part of the Furniture Combo Breaker
    What is your LTV? Do a basic mortgage comparison to have a look at rates but bear in mind additional fees.
    Do you want another fix or are you considering variable options , you could ask them for their current rates also.
    I wasn't expecting rates to stay low for so long but now I think it may be another while before they go up, a year at least so personally I don't think a 2 year fix is worth it unless the rate is amazing. We decided to go for a 10 year fix but I know that is not for everyone.

    Who did you go with for the 10 year fix?
  • kaggi
    kaggi Posts: 256 Forumite
    Part of the Furniture 100 Posts Name Dropper Combo Breaker
    My LTV is 60% and there's no fees for me to move to this new discounted rate. Their variable is currently 3.99 so the offered rate is lower. I am just not sure if it is worth looking around or if this is a good deal. If you don't mind me asking, what rate did you get for a 10 year fix and who was it with?
  • superdon
    superdon Posts: 317 Forumite
    Part of the Furniture Combo Breaker
    We are looking at TSB for our ten year. One big selling point for us is that there are no ERCs after 5 years. So if out circumstances change or the interest rates fall even further by any chance, we can review things after 5 years.

    We are at around 70-75% LTV. So the TSB rate till be 3.59% but that's with no set up fees at all and £500 cash back. I think the rate for up to 60% LTV is 3.19% again with no fees and the cashback.
  • We are going to Nationwide, applied for 2.94%, rate went down to 2.89% so we asked for a reduction - doubt we'll get it now because I see they don't offer this anymore! First direct still does at 2.89 and barclays at 2.94. Santander used to have it too, seems like they are getting withdrawn / rates are getting higher as I would expect from the recent market moves.
  • superdon
    superdon Posts: 317 Forumite
    Part of the Furniture Combo Breaker
    We need to wait for TSB to renew their deals as the current offers have to be drawn by the end of July. Our ERC ends on 1st August!

    Fingers crossed they keep the same (or better!) deals.

    Just busy doing a load of work to the house to help with the valuation.
  • oh no! So could nationwide make our rate worse? currently 3.29 so much worse than 2.94 we applied for
  • Jhoney_2
    Jhoney_2 Posts: 1,198 Forumite
    Do the products expire and get renewed at rates offered previously or do they expire and always change the rate? Was thinking of some of the 10 year rates mentioned above.
  • Jhoney wrote: »
    Do the products expire and get renewed at rates offered previously or do they expire and always change the rate? Was thinking of some of the 10 year rates mentioned above.

    The lender can change the rate whenever they want, for a better one or worse. Once you have submitted the application apparently you are guaranteed the rate you applied for. Until you have it can change overnight, and indeed it did with nationwide.
  • superdon
    superdon Posts: 317 Forumite
    Part of the Furniture Combo Breaker
    TSB have renewed their deals on the 10 year fix today at the same rates by the looks of it, with an October latest completion.

    We will be looking to apply for this in a few weeks once we have finished off the work we are doing to the house.
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