Help: Need Advice before 3pm today.

JMU-95

Hi, hope someone here can advise me. We have an appointment to go into see about changing our mortgage over to a 5 year fixed deal with A&L at 4.54%.

But OH has just phoned to say that a friend of his (property dealer) told him to wait until next month as interest rates are going to go down by nearly 1%. I don't think this can be right???? Any advice?

Thanks

JMU

Sumostar

Hope you get this in time

Commercial interest rates usually follow the Bank of England rate. I cannot imagine that will go down by 1% in the near future. Even if it goes down by .25% you still have the security of knowing that your rate will be STABLE, which will allow you to budget better.

Spendless

Hi

Well I'm sure someone with more expertise than me will answer but all I can say is that in the past few years I've only seen rates change by a 1/4% at a time. that's not to say we didn't get several months of change, just never known a 1% all in one month. But will stand to be corrected.

Woby_Tide

he won't be much of a friend if by next month A&L have put their fixed rates up. The likelihood of even a quarter point reduction is slim to nil, a 1% cut about as likely as meanmachine being happy with current house prices

Rikki

There was a discussion on here the other day about fixed rate mortgages and I believe the general thought fix rate mortgages rate more likely to go up than down. I'll try and find the thread for you.

It was first posted by Mortgagegenie 10-08-05. It in the mortgage section.

Ian_W

Woby_Tidea 1% cut about as likely as meanmachine being happy with current house prices

Won't be putting any of my money on it at Ladbrokes, then!!
All said above, and Woby will show his a**e in Burton's window if they do!!

Woby_Tide

Burtons? I'm more George at Asda

myrnahaz

Mortgage rates are definitely not following the recent Bank of England reduction. I rang Bank of Scotland at lunchtime (we reverted back to a variable rate in March, and i've been hanging on to see how low the fixed rates drop). I asked if they could offer a better 2 year fixed rate than the one they offered last month (which was 5.09%), and they said the fixed rate had actually risen to 5.25%. When i queried this in the light of the recent Bank of England reduction, she said the rise was required to cover costs - I'm not sure i understood that one. Fortunately, my offer from last month is still valid so i'm going to send it back PDQ unless i find something better (HSBC is 4.99% at the moment).

Froggitt

Sounds like a good deal OP

Ian_W

myrnahaz wrote: I asked if they could offer a better 2 year fixed rate than the one they offered last month (which was 5.09%), and they said the fixed rate had actually risen to 5.25%. When i queried this in the light of the recent Bank of England reduction, she said the rise was required to cover costs - I'm not sure i understood that one. Fortunately, my offer from last month is still valid so i'm going to send it back PDQ unless i find something better (HSBC is 4.99% at the moment).

Is there some reason you want to stay with BOS like redemption penalties?
Reason I ask is that even 5.09% fixed for 2 years is not, at least on the face of it, a particularly good rate - better than SVR - but the market leading rates for 2 yr fixed are around 4.2%.

Now switching will involve some fees, up front or added to the loan, but many remortgages inc free valuation & legals. Before you commit to BOS I would have a search at the moneysupermarket, moneynet etc and perhaps give a broker, maybe L&C a call - all are available on the Mortgage section of the site.

I may be wrong, but at first blush, you probably could do a lot better than BOS - they've already had a good buttie out of you on SVR - worth at least checking before you commit I would have thought.

JMU-95

Thanks to everyone for all the advice. Going to stick with A&L and go with the 5 year fixed. Lady on phone said I can't reserve it for 1st November until 1st September. So must phone back on Thursday. Hope it doesn't go up on the 1st of the month. Cheers everyone.