Fixed Rates and Pending Interest Rates

ShowUsTheMoney

After 5 great years of a lifetime tracker (1.89 + Base Rate 0.5%), we finally decided to take the plunge and move over to a fixed rate before the banks take the opportunity to put rates up / reduce the amount of fixed rates on offer. Having been caught up in high fixed rates in the past, made the decision with some trepidation and lots of rainy Sunday research. Pleased to say we secured a rate of 3.19% fixed for 10 years, which is not a million miles away from the 2.39% we are currently paying on the tracker. Only time will tell whether its the right decision, but at least I know what my payments will be for the next few years ......phew !

dimbo61

10 years is a very long time so I hope you have NO plans on moving any time soon?
Been in our home for last 9 years and very happy here :-)


Will rates rise in the next 10 years YES YES YES
How much and how fast is the question

ShowUsTheMoney

As Phil and Kirstie would say this is our planned forever home.....I can't be bothered to clean out the loft ; ) . We opted for the TSB fix and flex 10 year which only has early repayment charges for the first 5 years and then you can decide whether to stay or move on after that point....not an advert, do your research boys and girls, but it seemed a good option for us

delmar39

Congrats! Yes similar here was on a SVR but switched to a 5 year fixed at 2.34%, less than the SVR which was 2.5%. Nearly went for a 10 year fix, but in the end and after much debate thought that 5 years gives us enough stability for now. Will look to minimise the potential hit by overpaying. See how it goes! No right or wrong, but the fact you don't have to worry about your mortgage for 10 years is no bad thing.

swindiff

Fixing for 10 years doesn't necessarily mean you can't move. Most of them are portable.

getmore4less

It is quite easy to quantify with a 10 year plan.

eg: £100k 3.19% £975pm

After 5 years left with £53935

if rates did not change the 2.39% would have £50606 left.

and paid off in 9 years 7 months (Just under £5k less interest)

dimbo61

Time to overpay each month!
So if you owe £100K then £55 a month would help

Ashingtonian

I was thinking about doing this as well. Been on a 1.69% plus base rate so 2.19% tracker for the last few years but have seen a 2.54% no fee 5 year fix being offered by the Halifax. Is this a no brainer?

funkyfin2000

No we currently have a lifetime tracker of 1.26% above base, so 1.76% for last few years.

We are taking the plunge to buy a new home and ditch this mortgage and goto a 5yr fixed on 3.15% I think all being well, not the best rate for 5yrs but what's available to us due to Childcare.

Again time will tell if this was the right thing to do, but it will help us move to our forever home (we think anyway!)

ShowUsTheMoney

2.19% always sounds attractive but it only takes the base rate to go up 0.5% .........and then it could be a different picture. It just depends on your own personal circumstances, but having seen what raising rates can do, I would rather have the security of a low fixed rate. Already seen that the fixed rates have been increased by some lenders in the last two days.

ShowUsTheMoney

Hi dimbo, I have the fixed in place and it also allows up to 10% overpayments on the annual balance, so I will also be looking to put a £100 away each month and then put it towards the mortgage at the end of the year. Putting the cash in the tsb current plus which pays 5% gross on balances upto £2k .......and then I have the option of spending or putting towards mortgage. As always, research and check all the facts out first.