Mortgage Doubling!

BanjyMoFo

I am coming to the end of a 2 year fix at 1.7% but the issue I have is that we have a very high LTV as we stretched ourselves with this house. 

I am opting to go onto a tracker in the hope that better rates appear but that means we will be at +0.59% above the base rate so subsequently our rate will be 5.84% for a few months. Our mortgage repayments are going from £1033 to £1895 month which is really going to stretch us.

The best fixed rate I was offered on 2 year was 5%. My current mortgage lender has the best rates on the market but only for new customers which has really made it quite difficult. 

Is the short term pain worth it in the hope I can lock in a cheaper fix in the summer? 

BanjyMoFo

I was meant to say almost doubling in the title 🤦‍♂️.

DE_612183

Depends on your aversion to risk - it "looks" like rates "may" come down so the tracker "might" be the best option - as hopefully it will be better in the long run - but rates can be affected by inflation - it only takes a huge crisis ( like Ukraine or middle eas ) and suddenly rates are on the up again and so is your tracker rate.

As I said - it's how much you like to risk / gamble....

BoGoF

When exactly does the deal end. The next BoE base rate decision is on 1st Feb which may give some clues

MattMattMattUK

It is not a solution to your mortgage situation, but can I suggest that as you have said this will really stretch you then it might be time to review your finances, either via posting an SOA on here, or doing it yourself one evening. Over time in general, but especially after moving house it is very easy to slip into being less economical with spending, the pressure of saving the deposit and getting costs as low as possible are gone and it is easy for expenditure to inch up. A good review might easily save you several hundred a month that was money you were not really realising you had been spending, or may decide you would rather spend elsewhere. 

justwhat

i was on 1.23% , mortgage fixed rate ending at end of month. We will just pay it off.

if we were not paying off, we would have done a 5 year fix. i personally think we are going too stay at current rate/rates with a small fluctuation over the next few years. (provided there is no more international turmoil)

My last fix was 2 year.  i cannot remember the 5 year fix   at the time.
i am currently getting quoted via virgin on 10% ltv , 37k ish lol
4.17% 5 year fix 
4.72% 2 year fix 

amanda1024

You could look at extending the term if you’ll struggle to make the payments. I can’t comment on likelihood of rates going down…