2 year or 5 year, which would you choose?

jolester

Hi all,

Mortgage is in two parts
Part one (323k) fixed period ends 30th June 2025 (was 1.92%)
Part two (90k) fixed period ends Aug 27 (good interest rate, not looking to merge)

I have just finished a call with Accord Mortgages (current lender) 

The best options are either

2 year fixed, £1495 fee (added to mortgage) 3.84% (£1685 p/month) or,
5 year fixed, £1495 fee (added to mortgage) 3.99% (£1711 p/month)

There is only £26 different between the monthly cost of 2 year and 5 year fixed.

I'm leaning towards the five year, but wondered what other opinions were?

Thanks for any thoughts

Badboi

If you’re not fussed about merging then I’d do the five for the security of the term, as god only knows what state we will be in in 2 years.   We have ours split due to a house move and while they were both out the fixed rate period we decided to leave them running separately ( even though they are on the same fixed rates for the same time period 🤣).

Newbie_John

The fee divided by 24 months = £62
The fee divided by 60 months = £25

So the 2 years is also more expensive by £37 on fee/month alone.

I'd go for 5 years, not sure how long the product switch takes - but I would wait as much as possible - there is another BoE meeting on 19th June, so it could have some impact on rates. My Barclays took few days so if I was in your shoes I would wait till 19th and then pick 5 years.

RelievedSheff

Another vote for 5 years. 

jolester

Thank you,

They have said if I confirm now I'll get any decreases that come in.  As I'm classed as self employed for mortgage purposes, the hassle of not having to provide company accounts, SA302's etc to a new mortgage company in itself has a degree of value to it too, which is why i'd like to stay if it was a fairly typical offer.  My preference is the 5 years just so I don't have to go through the process again in what seems to be the blink of an eye!! 

Thanks again