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Throwaway1 wrote: »
Personally, I'd go for a 5 year fix as security is important to me. (We got a mortgage for the first time in Nov and fixed for 10 years with a stupidly ambitious plan to overpay the maximum 10% every year so we'd be finished by the time the 10 year came to an end. Feel free to visit my diary so see how that's going).
We asked ourselves two questions: 1) If we go for a long fix, are we happy paying this amount monthly even if the interest rate somehow drops lower than it currently is? 2) If we go for a short fix and interest rates were to rise by say 5-10% at the end of it, could we cope with the new forced payments that would bring?
On balance, we would much rather potentially overpay (as in waste, not 'Overpay') a few quid a month than be in a situation where we couldn't afford the repayments and default.
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