Is my logic wrong

Wellgood · 13 September 2017 at 9:10PM

Nationwide are offering me 2yr fix at 1.64% or a 2yr tracker at the same rate of 1.64%
Now historically fixed deals were generally higher than variable so in my mind this suggests the bank are trying to "sell" getting the fixed rate. The cynic in me says this is because they expect rates to fall. So are trying to get people to pick fixed over variable......am I way off the markcwith this thinking?

ricky_v · 13 September 2017 at 9:48PM

I would be suprised if rates fall any further, although I said that when I got my first mortgage at 3.74% fixed for 3 years 6 years ago and again several months ago when I remortgaged at 2.08% fixed for 5 years (now sub 2% for the same deal). Maybe one day the banks here will pay mortgage debtors interest?:rotfl:

Maybe the banks think that the BoE base rate will remain at 0.25% for the next 2 years, which is why the 2 year tracker is the same as the 2 year fixed? SVR is much higher than fixed I guess to cash in on switching apathy, much like standard energy tariffs or "full price" for broadband.

ACG · 13 September 2017 at 9:51PM

I cant see rates dropping. Maybe they are hoping people go for tracker rates hoping rates rise?
The governor of the bank of England said rates are more likely to rise sooner than expected than they are to drop or remain the same only this week.

amnblog · 13 September 2017 at 9:55PM

You are crediting the Banks with a level of wit that I rarely see in evidence.

Is my logic wrong

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