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Original poster

Fix for 5 years or 2 years variable???!

81 replies

Cake4 · 04/11/2022 21:32

I know I know another mortgage one, everyone is sick of it.

But what do I do?!

I know none of you have a crystal ball, and it's my own decision etcetc but any advice?

I read online one minute, interest rates have peaked. The the next is interest rates to rise over the next 2 years.

What would you do take the variable at about £850 a month or the fixed at £1100?

£1100 is near the top budget I can manage, so should I just stick with this incase it gets worse?!

OP posts:
Spraylatter · 03/03/2023 20:10

A friend works in the bank and most recent communication internally is they expect the base rate to increase again.

However an expert has said the rates might decrease in the summer.

It’s such a hard one! We have just fixed but doesn’t start until end of aug and we can cancel
with no issues until that point. This is current provider 6 months before then end of deal.

What rate are you looking at for a 5 year fix? We managed to get 3.99%. If you are on the cusp of an equity to loan boarder have a look and see how much it might be if you pay a bit more
off the mortgage (if possible it’s not always do able for everyone)

bonjello · 03/03/2023 20:13

Fix for 3

Original poster
Cake4 · 03/03/2023 20:17

Spraylatter · 03/03/2023 20:10

A friend works in the bank and most recent communication internally is they expect the base rate to increase again.

However an expert has said the rates might decrease in the summer.

It’s such a hard one! We have just fixed but doesn’t start until end of aug and we can cancel
with no issues until that point. This is current provider 6 months before then end of deal.

What rate are you looking at for a 5 year fix? We managed to get 3.99%. If you are on the cusp of an equity to loan boarder have a look and see how much it might be if you pay a bit more
off the mortgage (if possible it’s not always do able for everyone)

It is so hard isn't it! Everyone seems to be saying different things about what will/won't happen.

In the end I just didn't want to worry about it monthly, so fixed!

It sounds like we have a similar deal, and hopefully just caught them in time before things are (possibly?!!) on the rise again.

OP posts:
Spraylatter · 03/03/2023 20:21

@Cake4 definitely, who knows what’s going to happen. The other way I look at it is it’s really only 4.5 years fixed, with your current provider you can swap normally 6 months early without ERC. I would rather have the piece of mind with a set out going.

Original poster
Cake4 · 03/03/2023 20:30

Spraylatter · 03/03/2023 20:21

@Cake4 definitely, who knows what’s going to happen. The other way I look at it is it’s really only 4.5 years fixed, with your current provider you can swap normally 6 months early without ERC. I would rather have the piece of mind with a set out going.

I like this!

OP posts:
Babamamananarama · 03/03/2023 20:34

I would go for the tracker, and invest the £250/month difference in a First Direct 7% savings account. Adjust your savings rate if your mortgage goes up/down. If it goes up past £1100, then you start to spend the savings pot instead.

I don't think interest rates are going to go up another 2.4%, they are supposed to be heading downwards.

I'd be interested in whether you'd be up or down after a few years compared to a fix. If you were up after 2 years, you could always pay off an extra chunk of your mortgage.

If there is no exit fee, you can always switch to a fix at a later date?

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