Interest Rate Rise

Simon_'Sprout'_Phillips

I feel a bit stupid asking this, but I am one of these homeowners that have never experienced an interest rate rise.


I have approx 10 months left on my fixed term mortgage at 5.09% £740 a month.


if interest rates go up 0.25 or 0.5% by the time I come to shop around (or be put on a variable rate mortgage by the bank) as long as the interest rate on my next product is lower than the 5% I am paying now, I am okay. In other words I have built in some protection from interest rate rises and it just a case of shopping around for a good deal and what products (and offers) the bank(s) are offering?

glosoli

You are protected in the sense that you are familiar with paying a high rate of interest up until this point, so if interest rates shot up tomorrow and were at around 5% again then for you it would be business as usual, whereas others would be feeling the pain!

You can check out your lenders existing customer retention products normally these can be applied for online or you can research the wider market for a more suitable rate/product. Fingers crossed you are able to get something competitive this time around!

Simon_'Sprout'_Phillips

me and my wife could have gotten a lower interest rate at the time, but it was a product that suited us in that we spen 12 monthe rennovating the house before moving in and knowing we wanted to start a family we were fixing ourselves for the 5 years so we knew what we would have to pay and not be affected by any rises and we could comfortably afford it.


definitley lower interest deals out there and was just checking the Halifax products (who we are with currently). Hopefully when the time comes we will be okay.


I know people who are some (in some words) ridiculously low interest rate mortgages and they are worried they are going to have to fork out money when they have 'maxed' themselves to begin with on what they can pay

getmore4less

You probably should have reviewed a ditch the fix a while back.

LTV should have improved and rates have dropped.

probably border line now with only 10 months left, depends on new LTV and ERC and what deals are out there.

ACG

There are not many products on the market with 5% interest rates anymore, even for those with bad credit.

I would be surprised if you end up paying even remotely close to that rate. Have a look at your mortgage offer and what the rate is that your mortgage will revert to when your current deal finishes. Bang on half a percent and you may find you are saving money without doing anything. Although there probably will be better deals out there when you come to switch products.

Simon_'Sprout'_Phillips

ACG wrote: »

There are not many products on the market with 5% interest rates anymore, even for those with bad credit.

I would be surprised if you end up paying even remotely close to that rate. Have a look at your mortgage offer and what the rate is that your mortgage will revert to when your current deal finishes. Bang on half a percent and you may find you are saving money without doing anything. Although there probably will be better deals out there when you come to switch products.

Thanks. I cant even remember what sort of mortgage we could choose from at the time. We had a 10% deposit on a purchase of £153k and Halifax had an offer where they paid our stamp duty, so saved 1500 quid. There is plenty of equity in the house now as well with house prices rising and it being a complete gut and refurb.


Generally we have been quite fortunate.

Thrugelmir

Simon_Sprout_Phillips wrote: »

I have approx 10 months left on my fixed term mortgage

More importantly how much do you owe and how many years of repayments lie ahead. Paying off a mortgage is a marathon not a sprint. The one certainty in life is uncertainty. Interest rates are simply one facet. Where no one knows what may lie ahead. Job security, relationships and even life itself. All can be part of the rollercaster.

Take the opportunity to lock into a low rate and make the most of the opportunity to reduce the debt you owe. Then you'll build sufficient protection for whatever life may throw at you on a personal level.

Simon_'Sprout'_Phillips

Thrugelmir wrote: »

More importantly how much do you owe and how many years of repayments lie ahead. Paying off a mortgage is a marathon not a sprint. The one certainty in life is uncertainty. Interest rates are simply one facet. Where no one knows what may lie ahead. Job security, relationships and even life itself. All can be part of the rollercaster.

Take the opportunity to lock into a low rate and make the most of the opportunity to reduce the debt you owe. Then you'll build sufficient protection for whatever life may throw at you on a personal level.

I have 25 years left. will take me up to 60 years young. If I can save on what I am paying now when the time comes, I will certainly look to overpay