how long would you get a fixed rate mortgage for?

emmamc252

we are looking at mortgaes, at the minute we fancy a fixed rate as we are ftb and would like the stability that it offers. only thing we are confused about is how long to get it for. we are looking at nationwide who have a raate of 5.63 for the 5yr fixed option woth £499 arrangement fee, they also do 2,3,10 and even 25 years. we would ideally like at least 3 years for the security as mentioned before, i'm a teacher so my salary will go up each year but just wondering what people think would be the best option for us? i have no idea about what is likely to happen with interest rates, i know noone can say for sure, but just interested in opinions.

thanks!!

pollyanna24

When we bought our house 20 months ago, we took out a 2 year fixed. Boy, do I wish we'd taken a 5 year one now?! But that's the game you play.

We took a 2 year fixed rate because when we bought our first house in 2003, we hated it and stuck it out until we could sell it and we were worried that the same thing would happen again. Of course, we didn't know that interest rates would go up so many times.

This time round, I'm going for a 5 year fix cos that is long enough to feel secure, but not so long that you can't stick it out until it's over. I would probably take the 10 year one, but the 5 year fixed (I'm with Nationwide already) has no fee as a switcher loyalty produce, where the 10 year one has a £499 fee.

tanith

I took out a 5 yr one with Nationwide 3yrs ago and now my OH is nag nag nagging me cos he did say at the time lets do the 10yr one...:eek: I guess it would of been a better idea ...

lofty_cherrytree

We moved to our current home nearly 5 years ago and took out a ten year fixed rate with the Derbyshire BS because we needed the stability of knowing what our outgoings were. At the end of that time our mortgage will end, only hitch is we can't begin to overpay until January! Just check out those type of penalties.

dunstonh

Avoid 2 and 3 year fixed as you just end up paying fees every 2/3 years which wipe out the gains.

honest_guv

My nationwide discount mortgage is about to end, and I was also looking at the 5yr nationwide fixed (with no fees). However, I've just checked back on their website and can't find the no fees offer now - it only shows as £499.
Does anyone know if this has ended?

Also, will the base rate change yesterday have any effect on the fixed rate deals in the near future? i.e. would it be worth hanging on for the rate to fall?

jillybobs

When we bought our first home in 1998 we got 5 year fixed rate at 7.4% which we thought was good at the time and interest rates dropped. We ended up paying over the odds for at least 3 years. After that we took 2 year fixed rate at 3.85%!!! How I wished we taken that one for longer. We're now on 4.89% for five years - we're only 2 years in but fancy moving house so unsure if we'd lose this rate then. Its a gamble whatever you do.

JonnyBravo

honest_guv wrote: »

My nationwide discount mortgage is about to end, and I was also looking at the 5yr nationwide fixed (with no fees). However, I've just checked back on their website and can't find the no fees offer now - it only shows as £499.
Does anyone know if this has ended?

Also, will the base rate change yesterday have any effect on the fixed rate deals in the near future? i.e. would it be worth hanging on for the rate to fall?

No it's not ended....

http://www.nationwide.co.uk/mortgage/existingcustomers/interest_rates.htm

Yes interest rates may of course change in the near future. They tend to take their time assessing where the market is going before changing their rates etc on fixed rate offers.

gps_2

we fixed our 20 year mortgage (with a get out option after 5 years) at 5.65% with cheshire 2.5 years ago, seems like a decent deal for stability and not too bad a rate.
the mortgage is portable.

i know these are not very popular in this country, but i think it is worth thinking about, however the arrangement fee was only £295 then, don't know what they are now.

mummytofour

We took out a 2 yr fixed 2 yrs ago and have just been stunk with a rate rise of over 1% which to us is £200 per month. I wish we had taken out a 5 or 10 yr fixed rate, the thing is we also got stung 3k when we moved 2 yrs ago as we were still locked in with our last lender who would not give us enough to move! Damed if you do damed if you dont!

emmamc252

ok, so if we discount the 2 or 3 years, would people advise on getting the 5 or th ten year one? obviously interest rates will fluctuate but if we could get a rate of under 6percent on the 10 year one woud people go for that one?
we would probably move into another house within 5-10 yers, wouldn't imagine we would want to move on much before this.
5 years sounds like a long tome now but i would imagine that time will actually go quite quickly.