Offer on house and future mortgage rates

gadget88

My current one went upto £412 but I offered on a house so it may rise to £830. That’s a large jump but bigger house but my thinking is take a two year deal pay £40 a month more as that could drop to £650 by say 2 years time. Is that a good idea? I usually take a 5 year deal but I feel they say 5 rate drops possible is that a good guess on what it may drop to?

Hoenir

There's always the risk that mortgage rates might rise. Who knows what the future might hold. 

gadget88

Hoenir said:

There's always the risk that mortgage rates might rise. Who knows what the future might hold. 

So a 5 year deal is better than a 2? I would be surprised if they rise

Beeboo23

Personally my preference is 5 if it’s affordable because then you know exactly where you stand for the next 5 years. I wouldn’t lose sleep over mortgage rates going a percentage up or down after you’ve fixed. I fixed for 2.7 in 2020 which seemed high to me compared to my friends who were getting <2. Now it seems low compared to my friends who are getting 4-5. It’s all swings and roundabouts. That being said only you can say which is best for you. If you’re planning to move in the next couple of years maybe 2 is best. It’s a personal choice. 

ReadySteadyPop

gadget88 said:

Hoenir said:

There's always the risk that mortgage rates might rise. Who knows what the future might hold. 

So a 5 year deal is better than a 2? I would be surprised if they rise

 Many were surprised by the latest series of rises, I wouldn`t try to play the bond market at this stage to be honest, safer to fix and know how much your monthly payments will be.