Will Mortgage rates fall in the next couple of months

Learningmoney

I am looking at renewing my mortgage, as I am between jobs I am sticking with Halifax for ease. I have a rate of 3.74% locked in to start in May. However they said I can start that rate in March if i want. How likely do we think it is that rates will continue to fall until May that I will miss out on a better deal? Seems like things are dropping. Thanks

Woodstok2000

Yes.

Or maybe not.

mebu60

The next BoE MPC meeting is on 19 March and the one after is 30 April. There's no direct correlation with mortgage rates but if there's a decrease in Base Rate at either of those meetings a reduction in mortgage rates may follow at some point. If you're feeling confident that there won't be an increase in the BR announced before May then you could wait but any reduction announced on 30:04 could take a while to filter through in mortgage offers. I am assuming your current rate is not massively >3.74% that would tip the balance to a March start regardless. Institutions own cash flows also impact what rates they are prepared to offer.

RelievedSheff

With the Halifax you can lock in the rate now to start in May but if rates drop in the meantime you can switch to the cheaper deal.

We currently have a mortgage offer with them that we secured in December. Rates have dropped twice since so we have swapped to the lower deal. Conversely they have raised rates since and we are now sitting on a lower rate than they are currently offering.

I doubt we will get a lower rate now as we are due to complete mid next month but we will keep an eye on what they do with their rates just in case.

I personally don't think that barring any economic crisis rates that mortgage rates will drop much more in the short to mid term which is why we are happy to fix at 4.04% for 5 years.

Learningmoney

https://forums.moneysavingexpert.com/discussion/comment/81891383#Comment_81891383

Thanks - i have done that - but if I were to start the new rate in March I would be locked in as the bank are offering to start the new mortgage 3 months early for no charge.

RelievedSheff

https://forums.moneysavingexpert.com/discussion/comment/81891700#Comment_81891700

So don't start it early.

ritz55

The question is what rate are you paying if you don't lock in until May?

Learningmoney

https://forums.moneysavingexpert.com/discussion/comment/81892184#Comment_81892184

Yes its a fair bit cheaper by £150/month - which is my dilema.

MFWannabe

Personally if your current interest rate is more then I would change to new one early

3.74% is a very good rate imo

ritz55

https://forums.moneysavingexpert.com/discussion/comment/81892348#Comment_81892348

Personally I would switch now rather than wait, the saving in the rate change you will likely have paid more each month in any case.

Between now and May, the maximum rate drop I would expect from the bank would be around 0.25%. You can use the MSE mortgage calculator to see what the difference would be if rates were to drop compared to a slightly higher rate. Just keep in mind there is no guarantee the rate will drop so may not benefit if you wait in any case.