Fixed rate vs tracker

PuppetMaster_2

I'm a first time buyer and was looking at getting a 2 year fixed rate mortgage at 5.89% - but given the uncertainty with the financial markets at the moment and more people thinking perhaps interest rates are peaking is this a bad time to plump for a fixed rate? Might a tracker mortgage be better right now??

Any thoughts welcome!

sammyjammy

Well nobody can really advise you, it depends on what is important to you, is it to have payments the same so you can budget accordingly? If you are looking at a tracker the the sensible thing to do is look at two or maybe three 0.25% rises and see if your mortgage is still affordable. I just remortgaged and went for a two year tracker after being on fixed rates for the last 8yrs.

Sam

MissScarlett_3

What are current capped rates/set up fees? I understand that there's only a handful available.

It really does depend on the affordability of the mortgage. I know that when I was a FTB I would have fixed as my income wasn't great. I would have fixed at a rate that I knew was within my limits for however long as opposed to feeling gutted that i was paying more than I could have been if that makes sense. Indeed I did have a fixed at one point when interest rates were lower but it suited me. Nowadays i am looking at a tracker but thats because I can afford a few more rate rises and my personal circumanstances have changed. Maybe some could advise on a particular product once you have decided what route to go down, either fixed,capped,tracker of discounted.