Best two year fix?

mose_2

Anyone know of a 2 year fix at the moment, less than 5% if poss.

dunstonh

Yes. we know of lots of 2 year fixed. Although 2 year fixes arent exactly the best deals to go for at this time. Not unless you like the expensive option.

inch_high

less than 5%? You'd be lucky! EIther that or yyou'd be paying a £3k product fee!!!

mose_2

dunstonh wrote: »

Yes. we know of lots of 2 year fixed. Although 2 year fixes arent exactly the best deals to go for at this time. Not unless you like the expensive option.

Why is this?

dunstonh

In a 10 year period you will remortgage or buy new deals 5 times with a 2 year fix. With a five year fix you will pay only twice. Fixed rates arrangement fees cost more than they did in the past. Its quite common to see arrangement fees in excess of £1000 now. So, lets assume say £800 a go, then thats £2400 more you pay in fees over 10 years. Yet the 2 year fixed rates are usually very little different to the 5 year fixed rates.

mose_2

I agree, but the only reason i was looking at a two year is im thinking that rates will come down a bit by then?

dunstonh

They could also go up. There is still a lot of upward pressure on interest rates and its probably only the credit crunch that has held them back.

Even if they drop a quarter to a half, would you save more than the arrangement fees (which are likely to be in excess of £1000 in 2 years time)?