2 Year Fixed vs 5 Year Fixed Mortgage? Today's News of Interest rates Going up ??

Merchandiser2367

Hi all,

Really need some advice please.

Our 2 year special rate fixed mortgage ends in September and I am not sure what is the best option in terms of a Fixed 2 year of 5 year deal with today's news that intrerest likes are likely to be going up soon...

The 5 year fix is around £60 more a month than the 2 year.......do you think rates will go up quite a bit in these 2 years so this £60 will be saved in the long term?

getmore4less

If you really believe rates are on the up why only looking at 2 and 5 years.

Both only protect for a very short time.

libf

Merchandiser2367 wrote: »

Hi all,

Really need some advice please.

Our 2 year special rate fixed mortgage ends in September and I am not sure what is the best option in terms of a Fixed 2 year of 5 year deal with today's news that intrerest likes are likely to be going up soon...

The 5 year fix is around £60 more a month than the 2 year.......do you think rates will go up quite a bit in these 2 years so this £60 will be saved in the long term?

Source of news?

TCA

libf wrote: »

Source of news?

There was a hint from Mark Carney yesterday that a rate rise was getting closer. I noticed RBS upped the rates slightly on some of their fixed products yesterday:

http://www.bbc.co.uk/news/business-33522747

PixelPound

There is a whole world of difference between rates going up and rates going up "quite a bit". I think the hint is more that it each time they consider whether to rise and the time they will is close. So if the rate goes up by 0.25 how does that change the difference if you renew in 2 years time. How does it change if its gone up by 0.5% verses staying on a 5 year?

kingstreet

TCA wrote: »

I noticed RBS upped the rates slightly on some of their fixed products yesterday

Probably to slow down business flow. Their admin is in tatters at the moment and they could do with stifling demand for a few weeks.

cns06

We are applying at the mo. Going for a 5 year fix.

Prothet_of_Doom

I'd ask yourself what %age would the rate have to be, before you start selling the furniture ? Once upon a long time ago, I was paying a mortgage at 15.5%, when the plan had been 9.5% and I didn't even know you could fix the rate. I Eventually fixed 3 times, once at 9.5% for 5 years, once at 6.8% for 5 years, and finally for 10 years at 4.6%.

All the time i was fixed the variable rate was 2% lower than I was paying, which is a bummer, but hey.

If you can afford to fix and don't intend to move, or can get it portable in someway, I'd go for as long as I could.

libf

Nationwide have actually dropped some of their rates on fixes again...

2 year fixed rates at 90% LTV reduced by 0.10%
3 year fixed rates at 85% LTV reduced by 0.35%
3 year fixed rates at 90% LTV reduced by 0.25%
5 year fixed rates at 85% and 90% LTV reduced by 0.15%

Tlg1991

Me and the partner has just applied for a mortgage through broker. we was looking for a 5 year fixed as it secures us for longer.

But he advised us to go for the 2 years as our circumstances will change a lot (my girlfriend is still a student for another 4 weeks so when she start working we will be earning a lot more) and more options will be open to us.

We mentioned about rates rising he said yes they will rise but not anything like everyone thinks they will because of the scare tackticks in the media. and in turn on the 2 years we are getting a much better rate and paying around 150-200 less a month.

caprikid1

"But he advised us to go for the 2 years as our circumstances will change a lot (my girlfriend is still a student for another 4 weeks so when she start working we will be earning a lot more) and more options will be open to us."


Mortgage Brokers like 2 yr deals