To ask what you’re doing about your mortgage?

[Franklyfranky]

my 2% fix expired last December, enter massive rate shock as my repayments went up by £550. Dh was insistent rates would come down so we went for a 2 yr. the 2 yr expires in October (funding tranches) and I wish we we for a 5 year.

i can’t really justify paying the erc on the deal to move to a 5 yr now which would be about £1500. I’m hoping things calm down But given where rates are heading… womp womp

those whose deal is ending this year, what are you planning to do? I’m debating a PT to a tracker

I’m on a 2 year tracker that expires at the end of this year. I’ll probably go with another tracker so that I can feel the rate decreases sooner even if they don’t come for a while.

I would fix again, from the news, I understand that interest rates are now not predicted to drop.

We're doing 5 year fixes and trying to reduce the term each time we re-fix. I wouldn't do 2 years as it limits what you can do in a relatively short timeframe with other things on finance etc, also remortgaging is such a faff, the thought of doing it every 18 months 🙈

I'm not a gambler, I would rather pay more but know what I'm paying and can afford it

Why did your dh think they would go down?

We're on a tracker with no exit fees

To my understanding (I actually work in this area, recently joined hence my hindsight) there are still predicted to be 2 rate cuts this year, one maybe in Feb, the markets have priced it in BUT mortgage pricing is based on interest rate swaps, which are going up (thanks Rachel reeves) this will be even worse if there is no rate cut in Feb as its ’instability In the market’

You can get a broker to agree a deal 6 months before and lock you in? That’s what we did a couple of years ago. By the time our new mortgage started, rates were 4.5 but we’d locked in at 2.1%.

Well all indications at that moment would’ve shown that, the 5 yrs being cheaper than the 2 year shows where we were/ are in the curve and the inverse flash back 5 yrs when 5 yr rates were more expensive than 2 yr.

but trying to predict future swaps is a fools errand.

Because they were predicted to at that point.

OP, I think 2yr fixes are still your best bet at the moment. We fixed for two years in May 2023 at 4.99% and we’ve just got another 2yr fix for 4.49%, starting in May. There is 4.3% available now so we’ll apply for that too.

It's just we've not had any political stability, yes things were stabilising under sunak but then labour came in.

Nah, I’d likely PT with my existing lender I can’t be bothered to do a full remortgage and pay the associated costs.

i will of course when the 6 months kicks in, lock in the best deal I can and refresh it depending on where rates are.

im hoping the interest rate swaps calm down, I am shocked they are higher than they were tail end of last yr, with 2 base rate cuts

tail end of last year looked like it might’ve been ok but then inflation results came in and boom shit meet fan

On a two year fix that is £750 more than the fix before. I really don't know what to do because I can't afford another rise. Perhaps a tracker.

If you can lock in a rate now, before a hike and hope it comes down?

what the margin on the tracker you’re looking at?

For now, I’d fling that application in asap. I’m hoping things calm down by April

Hang tight - 4 drops were predicted and apparently now it’s only 2

Both predictions were in a matter of weeks - give it a few months and it’s all likely to change again - not sure it will get worse - afterall if people don’t buy houses the housing targets can’t be met because the builders will slow down production and the greedy banks won’t get their mortgage interest!

At the end of our 5yr at 2%, I wasn't convinced enough about the supposed speed of any forthcoming cuts.

I didn't feel the temporary pain of a higher rate tracker, then switch, would definitely be worth it, over a 2yr fix, on balance.

Just 14 months left now at 4.5%, £0 arrangement fee on a 70K mortgage. I certainly wouldn't have paid any product fees.

We locked in a dirt cheap rate for 5yrs in early 2022 and still have another 2yrs left. After the fixed rate ends the SVR will go up by 7% and almost double our repayments. After having such a low rate we don't want to increase it.

We are working hard to pay off all of our £105k mortgage by the end of the fix. 2 very frugal years for us will save us £20k in interest.

That’s not quite how it works though, it’s not the banks profiteering making the rates higher, it’s the swap rate and they’ll price against that based on their own commercial targets

I think you got the utopia in terms of timings

We went for a 5 yr fix (autumn 24) on a rate we knew we could afford (just below 4%). We valued the predictability over the fact we might find ourselves paying over the odds in the final few years. We have a young family, incl. nursery fees, so certainty meant more to us than playing the market.

We do try to overpay, even if it is just a few tenners each month. Hopefully it will knock off some time or allow for remortgaging at a lower amount.

I’m prioritising increasing our income tbh. It’s already gone up 60% every month and I can’t face any more.

Probably wise, our rates were over 4 when it came to it, thing it was 4.4 v 4.7% on a 2 yr… sub 4 might’ve made 5 yr more appealing.

hope they go down

I know. 0.99% for 5yrs is ridiculous given current rates. It's why we are trying to make the most of it whilst we can.

Although I do wonder if we should have gone for 10yr fix. - see how we are always second guessing rates and timings.

Hope you manage to get something decent as soon as you can.

Oh you jammy so and so (said in jest)