Are you fixing for 2 or 5 years....

dimbo61

Hi IAMIAM,
That depends on the size of the mortgage ? Over £150K and the 0.15% might make a big difference.
Who knows if the mortgage fee will be £490 in 2 years.
LTV is important when you come to remortgage.
If you have 15% deposit you might get to 75% ltv in 2 years. But you might hit 60%LTV on a 5 year deal !
Use " whatsthecost " to help do the maths.
Are you staying long term or is the property a first home with dream home long term plans

getmore4less

IAMIAM said:

Which of these two is better value on 140k 30 year term
2 Year 1.54% £490 Fee (3% then 2% ERC)
5 Year 1.69% £490 Fee (3% then 2% ERC after year 2)
I am presuming the 5 year, as in two years you would end up paying a £490 fee again for another 2 year fix

some information missing(LTV, rates for next lower LTV  and no fee rates as a starter ) but we can works with what you have given to give an idea.

These are really basic number crunches.

£140k 30y term (we can ignore the first fee as they are the same.
start with the basics 

rate	fees	payment
1.69%	£0.00	£496.04
1.54%	£0.00	£485.86

lets go a £500pm payment(If going to overpay you need to use the planned payment.

look at the amount owing at Y2  

amount	rate	payment	owing
£140,000.00	1.69%	£500.00	£132,613.06
£140,000.00	1.54%	£500.00	£132,197.46

then Y 4 for the 5y 

amount	rate	payment	owing
£140,000.00	1.69%	£500.00	£124,972.36

then run the 2y for 2 more years with a £490 fee added

amount	rate	payment	owing
£132,688.00	1.54%	£500.00	£124,656.90

Multiple 2 years are running ahead of the 5year if the rates don't change

Y 5 for the 5 year

amount	rate	payment	owing
£140,000.00	1.69%	£500.00	£121,054.14

then another year for the next 2y 

amount	rate	payment	owing
£125,147.00	1.54%	£500.00	£121,045.39

Three lots  2 years are still ahead even with 2 fees and a year to go before next fee

You can do the numbers to Y6 ...

IAMIAM

This is interesting. Thanks for this. The same fee creates a good cycle of the 2 year fixes, assuming the rate remains around the same in another two years....

IAMIAM

Any change of opinion based on budget, stamp duty, prices and current rates....

IAMIAM

So no changes then

Redwino222

Five years.  Like the certainty, fixed for five years at 1.3%.  

IAMIAM

1.3% is a very good rate. I have plumped for 1.44 with FD for two years, see what happens...

csgohan4

our fix ends next August and will likely fix for 5 years with inflation and/or Interest rates going to go up inevitably. Our current interests rate is 1.18%

lonibra

2 year fix, 0.99%

Windofchange

We come to renew / remortgage at Xmas and I am looking at 5 years minimum, 10 years if possible. We are in our forever home, and if I can get a good rate on 10 then I would go for that as I too have a bit of a niggling suspicion that inflation is going to kick off over the back end of summer and into autumn as the economy unlocks, and this could lead to enforced rises in rates.