Mortgage Rates

Hi Everyone,

Hope you are all well.

I think it’s a no brainer but wanted to get a second opinion please?

My fixed rate expired April 2023 when everything was falling apart and made the decision to go with a variable rate for 2 years (with £999 product fee) in the hope rates come down and I’m not tied into anything long term. Currently 5.99%.

This does seem to have proved worthwhile as although I’m not even 12 months in yet I can get a 3.89% fixed for 5 years (£999 product fee). There’s no early repayment charges. It will just be very frustrating to have paid nearly £2000 in product fees so close together.

It’s an impossible question really do we thing these rates might improve short term and I stick it out a bit longer or do I fix now knowing I’ve surety on costs.

Any advice would be appreciated.

Thanks,

Dave


Comments

  • ACG
    ACG Posts: 23,624
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    3.89% is good! 
    I would be amazed if they drop significantly below that in the short term. 

    You might not be happy with the deal you took, but in reality the only better option would have been to sit on the SVR as you would have had to pay ERCs if you fixed. Sitting on the SVR 12 months ago would have seemed like a mental thing to do. I think you actually made a good choice personally... when the good choice is costing you a grand in fees you know the choices were a bit pants to begin with! 

    I am a Mortgage Adviser
    You should note that this site doesn't check my status as a mortgage adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.
  • ACG said:
    3.89% is good! 
    I would be amazed if they drop significantly below that in the short term. 

    You might not be happy with the deal you took, but in reality the only better option would have been to sit on the SVR as you would have had to pay ERCs if you fixed. Sitting on the SVR 12 months ago would have seemed like a mental thing to do. I think you actually made a good choice personally... when the good choice is costing you a grand in fees you know the choices were a bit pants to begin with! 

    Thank you very much for responding 😊.

    I do think overall I’ve made the right decisions it’s just the product fees that gripe me but part of the process I guess.

    The more I think about it the more I think I should just fix. Hopefully 2 years into the fix there won’t be any significantly lower fixes available but that’s the risk I suppose haha.
  • bluelad1927
    bluelad1927 Posts: 306
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    It is pointless griping about the fee. It must be viewed as part of the cost of the product as its only purpose is to make the headline figure more attractive.


  • ACG
    ACG Posts: 23,624
    First Anniversary Name Dropper First Post I've helped Parliament
    Forumite
    How much more would you have paid on the SVR? 
    £20 a month for 12 months would be £240. It means as far as mistakes go, its cost you £760... Its probably not the worst mistake you will ever make. 

    Positive thinking! 
    I am a Mortgage Adviser
    You should note that this site doesn't check my status as a mortgage adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.
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