Is now the time to fix? Advice sought.

QueenKatie

I keep reading that a BoE base rate rise in November is "likely". And (without any political comment intended) it seems fairly likely that Brexit may mean a bit of a bumpy ride economically over the next few years. Inflation seems likely to be a pressure that might lead to successive but gradual interest rate rises?

I'm on a tracker mortgage at an unbelievably low rate (0.38% above BoE base). I have noticed that there are very long term deals available at the moment, e.g. 2.49% fixed for 10 years. I suspect that as rates rise, the rates on fixed deals will become less favourable? I owe about 30% of my property's price, and have a 15 yr mortgage at present (I've been overpaying).

Is now a good time to take advantage of one of the long duration deals on a fixed rate mortgage? I realise I will be paying more in the short term, but could it pay off in the longer run? What are others doing?

amnblog

If you are paying 0.63% you are a long way away from justifying a 2.49% rate four times higher.

None of us know what lies ahead with mortgage rates, we can only state opinions. We do know for sure that there are no financial blues skies ahead. That doesn't mean that your own financial position is not stable, so are rising rates actually an issue for you?

QueenKatie

Are rising rates an issue for me?

I'm lucky, in that I can afford a considerable hike and still be able to pay and in that I have savings sufficient to pay off the remainder of my mortgage should I need to. But it would virtually wipe out everything I have squirreled away, and I'd rather not do that. I am quite risk-averse as you've probably realised!

Really, the risk for me is emotional. I'm in a cheap city I don't really like for work that I love. I would like to get a place in another, more expensive part of the country, where my heart is. I know this may sound stupid and irrational, but I just have this constant feeling that I'm not where I should be at the moment. Don't get me wrong, it's a "first world problem" in the scale of things, and I'm being self-indulgent really. But I do feel quite homesick and unhappy sometimes. To get to the other place, however, I have to work really hard, both financially and on my career.

I want to clear my mortgage on my current house asap so I can start putting money aside to enable me to move in future, because I have a bit gap to clear in terms of property values and I am in my late 30s and do not want to run out of time.

QueenKatie

(Sorry, that wasn't very clear. My career situation is such that I can't just move my job - the move to the place where I want to be is effectively a kind of promotion, it's more prestigious, and I really have to earn it - working hard to endeavour to do so!).