First time buyers fixed rate query

marcustari

My wife & I have had an offer accepted on a house (first time buyers) and we are trying to choose which length of fixed-rate mortgage to take.

2 year fixed is the best deal, however with Brexit and it's inevitable destruction of the economy we are concerned that in two years time it might be a nightmare to re-mortgage so are leaning towards a 5 year fixed rate.

On the flip side, I see this house very much as a starter home and plan to move somewhere bigger in 2-3 years, so I'm hesitant to take a 5 year fixed rate in case we want to move.

Any advice?

marmitemum

If you want to move in 2-3 years, if you stay with the same lender you will probably be able to port the rest of the 5yr fixed into your new mortgage. My son and daughter in law are in that situation just now - selling the flat they bought, buying a house, and porting the rate for their new mortgage.

dimbo61

OMG the vote to leave has caused the UK economy to tank and riots in the streets.
House prices have crashed and mass unemployment !
Well maybe that has not happened yet but you never know.
It costs a lot of money to buy and sell so if you think you will only stay 2/3 years why bother buying ?

foxy-stoat

marcustari wrote: »

2 year fixed is the best deal, however with Brexit and it's inevitable destruction of the economy we are concerned that in two years time it might be a nightmare to re-mortgage so are leaning towards a 5 year fixed rate.

On the flip side, I see this house very much as a starter home and plan to move somewhere bigger in 2-3 years, so I'm hesitant to take a 5 year fixed rate in case we want to move.

Arrr I remember the run up to the year 2000, everyone thought that all computers would stop and the World would come to a halt. Thanks to the media for that one. The economy isn't going to self destruct.

If you are thinking about selling in 2/3 years then probably best you do a 2 year fixed deal - or not buy at all. Cost me around £10,000 and a load of stress to sell my first house and buy my second, including stamp duty, legal fees, mortgage fees, searches, application costs, , ...plus all the changes that you will do as soon as you move in.

fewcloudy

marcustari wrote: »

2 year fixed is the best deal, however with Brexit and it's inevitable destruction of the economy we are concerned that in two years time it might be a nightmare to re-mortgage so are leaning towards a 5 year fixed rate.
Any advice?

Lol, whatever...

On the flip side, I see this house very much as a starter home and plan to move somewhere bigger in 2-3 years, so I'm hesitant to take a 5 year fixed rate in case we want to move.

Leaning toward a 5 year fixed rate... plan to move somewhere bigger in 2-3 years... what could possibly go wrong?

Thrugelmir

marcustari wrote: »

2 year fixed is the best deal, however with Brexit and it's inevitable destruction of the economy we are concerned that in two years time it might be a nightmare to re-mortgage so are leaning towards a 5 year fixed rate.

Interest rates are at historic lows. In time they will rise. If anything Brexit is actually holding them down currently. Before you finish paying off your mortgage. Expect them to be somewhat higher.

wlondoner

If you go for a fixed 5 year rate you may well be able to port it but there will be restrictions and charges you need to check this before going for something for so long.
I know the "get out" charges go down year by year on the fixed rates mortgages but the first 3 years are quite high charges usually.

I went for a 2 year fixed when I moved into my first place

getmore4less

I see this house very much as a starter home and plan to move somewhere bigger in 2-3 years,

you really should crunch some numbers for a move in such a short period.

what will be changing to make that possible?
Will you be saving loads?
Getting big pay rises?
Inheritance/windfall?

What price bracket is the current purchase what will the bigger place be.

Can you stretch to the bigger place now and avoid a load of moving costs?

if already stretched then as above what is changing in the next 2-3 years.