Current risk of a tracker

cherub2008

I am on my 3rd 5 year fix which will then complete my mortgage after 30 years and 6 properties.The peace of mind they have given me has been enormous,and whilst I have,on occasions paid over the odds,in the end the cost seems to have evened out.

I was on SVR when rates went up to 15% and just about managed to survive,with many sleepless nights. The downside for those who had fixed at say 13% was that rates soon fell.

In these uncertain times,I think you can put a price on peace of mind and if I had my time over again,would always go for a fix.I appreciate that everyone is different and can only give my point of view.

Good luck with whatever you decide.

Gorgeous_George

I'm on a lifetime tracker at BofE base rate +0.74% paying 5.74% at present. However, I could be tempted to move to a 10-year fix at 6.14% (Britannia). Ten years will see me comfortably mortgage free.

I don't wish to spend my life worrying about remortgaging.

GG

Jonbvn

As always, no one can predict the future of interest rates. However, IMHO the whole remortgage every 2-3 years is a generally a poor idea, given the fees you have pay each time, and depending on the size of your mtg.

In addition to the fees, we have decided to make an effort to overpay/finish our mtg ASAP. For this reason we have recently switched to an HSBC lifetime tracker.

aliwali

Jonbvn wrote: »

As always, no one can predict the future of interest rates. However, IMHO the whole remortgage every 2-3 years is a generally a poor idea, given the fees you have pay each time, and depending on the size of your mtg.

In addition to the fees, we have decided to make an effort to overpay/finish our mtg ASAP. For this reason we have recently switched to an HSBC lifetime tracker.

Yes good point, and another reason we didn't go for a fixed rate as we would like to start overpaying. The HSBC fixed rate we looked at didn't allow you to do that so it was a definate no go.

carolineb23

as i read it, you can overpay up to 20% of you normal monthly repayments on the HSBC fixed, any more than that and you will be in for penalties, so it depends how much you wish to overpay.

Newbird

carolineb23 wrote: »

as i read it, you can overpay up to 20% of you normal monthly repayments on the HSBC fixed,

FYI -
This is good, as most other lenders I've seen, put the OPM limit at 10% on fixed products.
But then some give the % re: the loan amount, rather than the repayment, I think...so look carefully at the conditions. Will have to check HSBC terms myself now....

carolineb23

I've applied for the HSBC 10yr fix now, and you can definitely overpay by 20% of your normal payments (eg if your monthy layment is £500 you can pay £100 free of penalties) as long as the overpayment is by direct debit

Jonbvn

Newbird wrote: »

FYI - :money:
This is good, as most other lenders I've seen, put the OPM limit at 10%.
But then some give the % re: the loan amount, rather than the repayment, I think...so look carefully at the conditions. Will have to check HSBC terms myself now....

There is a difference between the HSBC overpayment T&C's and most other lenders. HSBC allows you to overpay 20% of your standard monthly payment. Other lenders allow you to overpay 10% of the capital sum outstanding per year. Therefore, for all mtgs with 10yr+ terms, the 10%/yr overpayment limit is a much higher amount..

straddie

Despite my previous posts in this thread, I'm now thinking of going for yet another deal - a First Direct 10 year offset fix at 6.19%. Whilst this is higher than the tracker, it would only take a couple of base rate rises to be cheaper, and the offset facility means we can reduce the effective interest rate we pay with our savings, which will somewhat mitigate against the 'risk' of the base rate staying low or dropping back again after a rise.

Only downside is it will be tight making the LTV, but hopefully with some serious saving we'll make it!

Newbird

Good luck with that Straddie sounds good to me - if you have dosh to offset, yep I'd do it, well I have already with my last mortg. It really does help.