What do you think of this rate?

tomstickland

On behalf of a friend of mine.
He's spoken to two brokers and the best deal he's found so far is 5.45% index tracker. He's borrowing 120K on a 150K property. I told him to speak to L&C and see what they could come up with.

I found a 4.3% fix last year. He said that all the fixes are now a lot higher than that.

payless

What do you think of this rate?

I love the rate , its so symmetrical

payless

Seriously this is a post that does not have an answer..

there;s so much more around a mortgage product than just the rate:

Fees ( in, out )
penalties/ ties
Flex options
Criteria ( actual chance of getting the deal)
Suitability towards budget/ attitude towards security ( fixed?)
Efficently of lender/ speed required

dwsjarcmcd

Payless is right, the rate itself is only one part of the equation, your friend may be able to get a rate lower that the one you quote but the fee may be £2k, as opposed to nil. All the T & C's need to be considered.

Paricularly where the rate is symmetrical!!

tomstickland

Yes, I am aware of all the other factors, but I was wondering where this rate fitted into the overall picture. eg: 10% would be high and 3% would be low.

I've had a look around online and it looks like a reasonable rate to me.

payless

Yes somewhere between 3 - 10 % sounds about right .. although of course neither of these are as symmetrical as 5.45

cm233lh

It may be a reasonable rate, but if it only lasts 2 years and costs him £3k to get and then reverts to a crazy svr then it may not be such a good deal. You have to consider all the costs, not just the rate.

In general I've found that the really cheap deals have big costs and then revert to a svr so you have to buy the next deal 2 years later and all your costs are down the drain. You might find that a lifetime tracker at a slightly higher rate would be better overall as you only have to pay once.

Like the others said - you need to look at more than just the rates. From my research most SVRs seem to be in the high 7s%; life trackers start at .2 and go up to 1.5 above the base; some trackers out there are lower or at a discount to the base rate, but only short term. Fixed rates are in the 6s% depending on the length. But your view of the market may be very different to mine.

tomstickland

Well, I spoke to him tonight and he said this was the lowest he could find without any really high initial fees. He spoke to two brokers and got the same answers from both. So there you go.

Fixed rates are in the 6s% depending on the length. But your view of the market may be very different to mine.

I took a 2 year fix at 4.3% last year. I'm wondering what it will be like this time next year when I remortgage. Of course I wish I'd gone for a 5 year fix now. Luckily I decided that variable was not the way to go.

nealgs

our current fixed rate is due to finish at the End of Sept 07. Going from a fixed 4.39% rate upto the ones available now means our morgage goes up over £100/mth (with another fixed rate) or to over £900 on the SVR rate.

Aarrrrgghhhh! - having a look around to see what's available, but can;t believe the fees some are now charging for them - over £1000 for some :mad:

Gary

PuppetMaster_2

nealgs wrote: »

but can;t believe the fees some are now charging for them - over £1000 for some :mad:

Gary

Yeah - Northern Rock were charging £3500 for one of their fixed rates!! But then we know what's happened to them in the last 48 hours...

Woby_Tide

nealgs wrote: »

our current fixed rate is due to finish at the End of Sept 07. Going from a fixed 4.39% rate

was that one of the Nationwide 2 year fixes?