Kicking myself about not fixing mortgage rate

[errnerrcallnernnernnern]

Hi, our mortgage expired a year ago and we have been paying the variable rate ever since. We were offered a rate of 3.4% for a 3 year term.

I have just called my bank now and have been offered a 5 year term at 3.9%.

I just wanted to get your views on whether you would take 3.9%, or should I shop around?

I am inclined to either to lock it in for 5 years or 3 years.

Thanks! Happy to provide more details if needed.

Implied Market Expectations for mid-2023 (Swaps) was 6%.

Now that the BOE has done its emergency intervention as a buyer of last resort (Gilts), that is likely to reduce a bit (say 5%), but that comes at the expense of higher inflation now over 2023.

Mortgage Pricing uses the swap rate as a risk free base, so you are not likely to see anything below 5% in mid 2023

Thanks @BambinaJAS

So if there is likely to be higher inflation then this means higher interest rates? It's like a never ending upwards pressure on costs of living. I was hoping that if prices shot up this year they would be more stable next year?

Deals will be going up daily so if you can see a broker tomorrow then fine, but I wouldn't wait long to see one.

Yes.

BOE will have to raise rates faster now because inflation will likely be higher over 2023.

Consensus now is a rate of 4.5% by mid 2023.

Gosh. Wish I could fix too. My deal ends Dec 2023. No idea what to do, don't fancy sitting stressing for a year 😢.

Same here @WorrieaboutFIL Mine is December 2023 too. I'm hoping things have at least stabilised at that point.

This

I fixed mine on Monday night, that was best my broker could find

• kicking myself for not fixing a month ago but that’s another story!

It's worth signing up for the MSE weekly email as it reminds you to pull your finger out with things like this.

I was on a tracker earlier this year and I knew my 2 year deal was coming to an end at some point. The email reminded me find the actual date that it ended and to put the date in my calendar when I could get a new deal. So as soon as I could fix for 5 years I did as interest rates were increasing.

For anyone looking, Money Saving Expert still recommends London and Country www.landc.co.uk/ they are free and have a proven track record. They are whole of the market phone and online broker.

Financial advisers charge a fee, they get paid twice, London and Country get paid once by the mortgage company and not again by you. We have used them for 20 years.

I would fix at that rate for 5 years.

does he @TheBoxOfWhat .. his narrative has changed lately I thought to "use a non fee charging broker and ask friends and family for recommendations".. of which there are many of us!

I completely agree the ones that charge a fee just get paid twice (we find many clients assuming they get them extra special deals, or they don't get a commission so get better rates when this is not true). Although at the moment I think we are all earning our money!

@Outnumbered99 this page on MSE was updated 3 days ago www.moneysavingexpert.com/mortgages/best-mortgages-cashback/ LandC still top recommended one.

I think financial advisers are worth their weight in gold with their knowledge and in this current climate where many are worried about their mortgage deals the idea of spending even more money on a mortgage broker adds to the stress. I was just saying that there are ones that don't charge a fee. People are often suspicious as to why that is, I was saying that MSE still back LandC and MSE is a trusted source.

Ah yes- you have to pay to appear on that list!

I agree with you, we have had enquiries before where people are suspicious exactly as you say.

Just been told that I wouldn't be able to remortgage my own property because I wouldn't pass the stress test of 8% based on my income, whereas when I took out the mortgage I was stress tested to 4%.
Iron as I was wanting to remortgage to avoid paying 8% whereas that is looking more likely if I stay put.

Can't you stay with the same lender?

Then you shouldn't have to provide any paperwork as long as you have kept up with your repayments.

Yes I can probably stay with same lender however NatWest have quotes me 6 weeks until I can speak to a mortgage advisor (pre-requisite for taking on new mortgage product with them). So I'll not be moving anywhere fast I think.

I've been really worried about this. Our mortgage is big and we're fixed until Dec 2023. The early repayment is a lot so I think we're going to have to try and ride it out, hope there's a little more stability (or at least clarity) by this time next year or maybe pay interest only for a period to whether the storm.

I believe inflation will peak but I don't believe that mortgage rates will rise infinitely. We will be unlikely to see the low interest rates that have benefitted many but I live in hope that things will steady at a reasonable balance.

Our fixed rate has just ended with NatWest, when the last one did 5yrs ago we saw a mortgage adviser in branch who talked us through the different deals. This time I was told we could talk to someone on zoom but it would be a couple of months and they can’t do anything different to what I can using their online tool. So I just did it myself last week, fixed at 3.8% for 5 years, mortgage has gone up £120pm but luckily it’s not an issue for us as it stands.

www.poundsterlinglive.com/gbp-live-today/17595-bank-of-england-to-hike-big-in-november-to-defend-pound-sterling-says-credit-suisse

This says BoE rates are expected to go to 4.5 in Nov then nearly 8% in Dec. Mortgage interest rates will therefore be higher.

I’d fix. You haven’t got time to piss about with a broker.

If you move to another lender you’ll have to go through their mortgage process, it could be weeks

Barclays were offering 3.65 for a 5yr fix just now. Seems a good deal

Interest rates going up 0.5% again shortly 🫣

I don't understand stats clearly! It is expected to go to 4% in Dec not 8%. I stand corrected.

I work alongside brokers (for a company who do not charge fees and is not L&C!) and I would fix right

Oops, right now. Last week my advice would have been different!