Mortgage Rates Crystal Ball..

RealBobbyDazzler

It’s time for my remortgage, currently on a Nationwide tariff of 1.65% fixed for 2 years, was a 75% LTV.

I’m undecided between 2 mortgages with the same provider, they’ve valued my property way higher than expected putting me below the 70% LTV mark.

1.29% fixed for 2 years. + £999 Product fee.
1.54% fixed for 5 years. + £999 product fee.

I’ve done some calculations on the interest charged on each for the 5 year duration if the interest was to stay at 1.29% for next remortgage & accounting for the extra fees.

I just don’t know what to do, half of me feels the security for 5 years and a fixed interest rate seems good now, but my partner seems to think interest rates are going to drop further.  I appreciate it’s a complete crystal ball, but just wanted to know what others thoughts & knowledge were, and what you would do.  Just for reassurance if anything as I’ll be honest, I don’t follow all of the financial news, just done some light reading this afternoon to help my decision.

Thankyou 

lonibra

It's just my opinion, but I don't think rates are going to drop more at that low an LTV.

RealBobbyDazzler

lonibra said:

It's just my opinion, but I don't think rates are going to drop more at that low an LTV.

Thanks, just hard to decide if going to go up.. whether we do 5 years vs 2 years.  Just interested in how others are playing it!  

lonibra

It's quite personal isn't it. I prize flexibility over certainty so almost always go for a 2 year fix or discount. As long as I'm getting the best rate that I qualify for at the time, I'm happy with that.

vixst

Can't see the base rate going any lower than it is currently. Personally I prefer the certainty of knowing what I will pay every month. I have just gone for a five year fix, I hope that the house will be our home for 20+ years so makes sense to me. But the penalty for early redemption is pretty hefty. So got to weigh all these things up!

RealBobbyDazzler

vixst said:

Can't see the base rate going any lower than it is currently. Personally I prefer the certainty of knowing what I will pay every month. I have just gone for a five year fix, I hope that the house will be our home for 20+ years so makes sense to me. But the penalty for early redemption is pretty hefty. So got to weigh all these things up!

I’ve done the same, went with the 5 years as really seems low.  Much safer that it goes down and I’m locked in at a slightly higher rate, albeit annoying rather than it going up to 2.5% or something again.

dimbo61

As long as you have No plans to move home in the next 5/10 years then 1.54% looks a good long term fix with the FEE costing less than £17 a month over the term.
Us OLD people remember 15% mortgage rates OUCH 

RealBobbyDazzler

dimbo61 said:

As long as you have No plans to move home in the next 5/10 years then 1.54% looks a good long term fix with the FEE costing less than £17 a month over the term.
Us OLD people remember 15% mortgage rates OUCH 

No, zero plans to move fortunately.  Funny you say that, talking to my parents today for a little advice & they said they wished the rates were like that years back!  Ha.

getmore4less

Look at Barclays 1.49% 7y fix.

How big is the mortgage and what are the no fee rates.

How long to get to 60% the real break in rates.

RelievedSheff

We have just taken a 5 year fixed rate. We prefer the long term stability of a longer term fixed rate.

We have a relatively short mortgage term at 15 years and are hoping to reduce that further the next time we remortgage. Our LTV next time should be around the 50% mark if not a little under so we will get the best rates available at that time.

IAMIAM

Interest rates will continue to drop for the 80% plus LTV.
The 60-75% LTV bracket will only drop when banks are competing to get into the top tables and currently that is what is happening at 75% LTV.
HSBC were the top at 1.34 last month, they are now out of the top 10 so have again dropped their rates to 1.29 today to get back into the top 5, this will continue until all banks are doing the same rate at the same LTV, you will then have to look at the small print.....