to think that ordinary people should not have to take a punt on their mortgage rate?

[Mintyy]

Just had letter from our building society.

Our mortgage is going down from £800 and something a month to £379.75.

This is because we opted for a fixed rate 5 years ago when rates were 5.something % (sorry for vague details, but ykwim).

Now that "offer" has come to an end so we are going on to the standard variable rate which is currently 2.5%

I could RAGE, SCREAM AND WEEP at the amount we would have saved over the past 5 years if we had not opted for a fixed rate at the time.

Aibu to think that I didn't ask to take a punt on what mortgage rates would do, I am not a gambler and I am not interested in taking risks.

It really makes me absolutely hopping mad I tell you!!

Now you are not on a fixed rate you can probably over pay more without being charged.

We also fixed before the rates dropped, we wanted managable payments. It was a gamble that didn't pay off but gave us peace of mind when we fixed it.

I would be interested to know the percentage overall of people who did/did not benefit from fixed interest rates

I think I know the answer though....

We were in a similar situation when in the summer of 2007 we took a fixed rate mortgage . 2 years later we changed (and paid an early redemption fee) to move to a variable rate. You could have changed it, although there would have been financial penalties. We had a variable rate in 1997 and it crept up and up. swings and roundabouts.

I do sympathise as Banks do screw us over while pretending not to..... However, interest rates have been very low for a long time... And were generally expected to stay low in line with the rest of Europe ..

So yabu

"You have a choice though, you didn't have to take a fixed rate!"

I am not sure how many more ways I can put this:

The WHOLE point of this thread is that I did not ask for a choice, I did not want a choice, I think it is wrong to make people make a choice.

So what do you propose, everyone goes on a tracker today when interest rates are 0.5% then in 10 years when interest rates might be 10%, no one can meet their mortgage repayments - genius idea that one!

The choice is given so you can try and plan your future repayments, you might get it right or you might get it wrong but that's life.

Sorry - but do you buy anything else without a choice?? That is just a bonkers response.

Also - if the rates have reduced so much whilst you e been fixed rate, why didn't you investigate switching to a variable rate, taking the early repayment hit. If you'd have done the sums it could have been worth it.

This is the biggest financial commitment most people ever make. It makes me very cross when people don't take charge and feel things have been "done to them".

I know you're cross but get a grip and pay more attention nex time.

Mintyy, that is a bonkers idea !

It's called a free market. Where the fuck would be without it ? Stalinist Russia ?

would we be

I understand what you are saying Mintyy.

And , if I understand it all correctly myself,even being on variable is a potentially riske choice too?

Also, and perhaps you understand this all better than me, you havent overpaid your mortgage, just paid more for it? Or have I got that point wrong?

tbh, I am not sure why there is such a huge difference in your figures.

What minty means is she should have been properly advised to take the best mortgage in the current climate

And most people knew that rates were very low

The insurance analogy was a good one. You were paying a premium, but had peace of mind that you could afford your repayments for the fixed term. You were insured against interest rate rises. It wasn't gambling at all. It was the opposite of gambling. You knew exactly where you stood and what your repayments would be. Variable would have been more of a gamble - one that would have paid off in this instance, but that's hindsight.

Crikeyblimey - anything else I buy with a choice has a fixed price. I know its either going to cost me a or b.

Or am I missing something?

But the whole point sadday is that the 'current climate' is not what it was 5 years ago.

mintyy was probably made well aware of the alternatives in 2008 but no one then would have predicted interest rates going so low for so long.

Opting for a 5 year term, unless interest rates are rock bottom as they are now, was always a gamble.

minty you really are missing the point- you might chose to buy anything today at one price, but tomorrow the price might shoot up or down- you take the risk to buy it today at the price offered today but it may turn out to be a bad or good decision in hindsight.

What Bear said.

When people talk about the blame culture I think that this is what they mean

You could have done nothing ie let your rate remain variable but you thought that the rate was going to go up so you elected to fix it. If the rates have gone up you be so smug with all your financially simple friends.

The whole thing isn't exactly rocket science yet you seen to think that you got duped into it.

The new mortgage you've been offered is a different product. Ok, it is doing the same job but it is different and wasn't available 5 years ago at this price.

Having been bitten by rates going up on a capped mortgage, since the cap was too high, we have had fixed. Sometimes we have won but as rates fell, I suppose we lost if you look at it that way. I prefer to know exactly what the monthly payments are each month. It was our decision and that's exactly what this about. Maybe you should have looked at offset or tracker rates instead but if you want the best deal, it won't necessarily be handed to you. Financial institutions are in business to make money. It's up to us to get the best deal out of them.

SJisontheway - the insurance analogy isn't a good one. Insurance is a product for a fixed price which might change if I make a claim.For insurance I am quoted a price and can shop around.

For my mortgage I can shop around but I am quoted 3 prices, 2 of which might change at any time, and I have no idea how to predict that.

A better analogy would be to compare it to going to Sainsburys for your weekly shop. Fill your trolley and take it to the check out. One checkout says the price is £100 and it will be £100 tomorrow. Another checkout says the price is £100 but it might be £50 tomorrow or it might be £150 tomorrow, fancy your chances?

I don't understand why you think people shouldn't chose their mortgage?

I'm sure you're pretty much on your own to think that people shouldn't have or want a choice.

Choice is a positive, not a negative thing

Once upon a time all you had we're the standard variable rates, the introduction of fixed rate and trackers gave people more options, reflective of their ability to absorb changes in rates and the level of risk they are prepared to take.

"You could have done nothing ie let your rate remain variable but you thought that the rate was going to go up so you elected to fix it. If the rates have gone up you be so smug with all your financially simple friends."

I'm guessing at what you mean by your second sentence.

Well, no, I don't think I would have been smug as I am really not by nature a smug person, if you can imagine such a thing MTS?

I didn't think the rate was going to go up! I didn't know! Who knows? Even the experts don't know.

I didn't think the rate was going to go down either. How the fuck would I know?

So I did what I thought was the average sensible fence-sitting thing.

And spent as much as £400 x 12 x 5 more than I needed to on housing my family.