text obsolete please remove

[Deleted User]

text obsolete please remove

Wongus

Check whether the fixed rate mortgage is portable or not and what are your options if you decide to move home. 

Depending on your personal financial position, if you are in a position where you can absorb mortgage repayment costs fluctuating upwards comfortably then a tracker is an option, if not then the fixed will be the sensible option. 

In terms of interest rates, this is not advice, purely my speculation, but an informed judgement. I'd expect rates to increase through Q2/Q3 2023, possibly achieving terminal rate in Q4 2023. I would then expect rates to be steady through H1 2024, then gradual and slow decreases through to Q4 2025.

What does that mean for you? Again this is based on my speculation. If you went for the fixed, you'll be paying a lower rate until around Q4 2024, 2025/2026 it'll be marginal and 2027 beyond you might end up with a higher rate vs base. On the tracker, your repayment will increase through 2023, remain steady through 2024, then possibly start seeing that come down gradually from 2025.  

ACG

With a 5 year deal you have to look at the longer term picture.
Rates are expected to go up next month, they are expected to stay there until the end of the year and then start to come down. 

Short term you would be worse off on the tracker, long term though you might be better off.

My personal view is that any savings on a tracker would be marginal unless the base rates comes down to 2%. I would opt for the fix personally for the security if nothing else. But if the base rate does drop significantly (which lets face it, anything is possible), you could end up kicking yourself (or me haha).