Fixed mortgage ends 2023 support thread

[Echo40]

Just wondering anyone else same boat?

Our fixed 5 year mortgage ends Dec 2023 currently Halifax fixed at 2.44%.

Freinds daughter trying get mortgage currently and she's been offered 6% as rates always above base rate.

Bank of England predict least 2 more rate rises in spring go try and control inflation they say as inflation the enemy.

Looked at recent annual statement.
Worked out what would be left to pay I dec.
Used Martin Lewis mortgage repayment calculator.
Can't extend term due to age.
Want to stay on repayment mortgage.
House definitely worth more than we paid and we put down 22.5% 54k so think we should have least 100k equity so no idea of the loan to value who get us a good rate.
I think we can start shopping around 6months before and think read Lloyd's would honour quote they could give us in July.
I put in worst case interest rate of 7%, as was trying to stress test us and see how much Increase we could be looking at.
Its around £300 per month at 7% as its so far away still no idea I reckon 6% very possible.

But add in Increase in energy and food which continues to rise could be looking at finding a extra £500 per month how is that viable for so many?

Not sure what to do trying not to panic it's beyond my control.
I'm focusing on what is in our control as follows and wondering what everyone else is thinking 🤔 or doing.

We wanted to extend as have 4 kids 3 bed house but scrapped that idea and we moving our bedroom into front lounge as have small lounge at back and divided one bedroom into 2 sides this way 17 year old gets own bigger room.
Son gets small box room and 2 middle girls can share but be divided compromise is much smaller lounge.

Added a 2nd income its minimum wage but every little helps.

Not through choice new boiler as old one condemned hoping long term that save us a little money and placed £2700 on 0% credit as paid 1k cash from savings.

Considering costs and savings of Woodburner in dining room as back of house open plan as worry about energy next winter without any government help at the moment we getting 67 month and cap is £2500. Cap goes up to 3k April and based on current dd we already exceeding 3k a year if stayed same for 12months.
We really need to replace 1 single glazed window and door this summer big expense but offsetting expenditure v energy bills.

Debt we have some credit card debt not because of luxuries just Increase in living costs mostly car related as have very little savings.
Transfered bulk of it to 0% deal think 15 months left on that need to check.
Aim is with credit card 2 which we do pay interest on is clear by summer.
Dont want to go into mortgage with large amounts debt or as they say high levels of gearing.
Credit score fairly good.

Other steps want to achieve before winter is

Save up 1 k emergency fund
Clear overdrafts and use them as emergency not credit card as short term help not live in them every month.

Have a xmas savings fund and buy majority presents early.
Already brought cards and other items cheap in sales.
This should take pressure off in December when I'm stressed about new mortgage.

As above try and find ways save money on energy to help us cope next winter maybe build up a credit over summer months give us a cushion.
Thinking getting air fryer, heated clothes airer and dehumidifier to try save some money on energy.

Stock pile more long life food do tinned / dried things with long life.
No foods like cleaning and bathroom which will help lower grocery bill for 2024 as our increased mortgage payments start xmas.

If we clear debt
Try lower food and energy
Have savings

Hopefully can absord the Increase still a worry hence why forward planning now.

Wondering if very high if even worth moving maybe as well continue with current lender on variable rate.
If we officially in recession will Bank of England start to lower base rates can't see it in 2023.

Anyone else stressing or planning.
Any ideas welcome
Think Martin Lewis keeps warning government this be next big crisis as everything is going up.
Even if inflation goes down energy and food prices won't fall.
Most peoples wages not keeping up with inflation anyways.
Will even effect renters too.
I guess the housing market will drop as house opposite sold 230k during time truss came to power then buyer lost mortgage deal so back on market and now months later sold 290k.

www.manchestereveningnews.co.uk/news/property/word-warning-millions-homeowners-fixed-25932216?int_source=amp_continue_reading&int_medium=amp&int_campaign=continue_reading_button#amp-readmore-target

uk.news.yahoo.com/million-uk-households-mortgage-crisis-155952811.html?guce_referrer=aHR0cHM6Ly93d3cuZ29vZ2xlLmNvbS8&guce_referrer_sig=AQAAANZx-abkLVCD5EFxvgng5NPtX8Qq2XltIoDkkVuowETEvGWU66PWd_TGqRANmEA7ZUHawSNUb5BamGmVaquZnrUjOUSMQoSqvaahvsuV2Zyt20w6XAf0EM-yBWjngmvhje7K5KiagW_Q7tJoXESE-CRkpQDg6kbuIOhC3eqiFpkr

amp.theguardian.com/business/2023/jan/08/mortgage-payers-face-squeeze-in-2023-after-uk-interest-rate-rises

www.express.co.uk/news/politics/1719063/bank-of-england-inflation-uk-economy-interest-rates/amp

My understanding is that rates are predicted to increase this year and then drop by 2024? So I'm think I might need to go on tracker for a bit,.until they drop in 2024. All a bit of a gamble though.

@Largethighsbadeyes It was with Virgin money on a two year tracker at a 60% LTV. It was available yesterday.

Mine runs out in March and I’ve just fixed for another 2 years. It’s an additional £150 a month but because of LTV (& my property’s 75% increase in value since I bought it 7 years ago) I’m in the lowest lending bracket apparently?

My mortgage is still less than I was paying in rent when house sharing with 4 others before I bought my flat. And I can cope with the increase of my mortgage costs, so all in I feel very fortunate. I’m just hoping once things settle down a bit, they’ll re-lower and I can re-fix but it’s all a bit of a gamble isn’t it?

Ours ends in April. I'm hoping to pay off a (small) lump sum, so that makes it less straightforward.
We're also in the fortunate position of only needing to borrow £20-30k & whenever I put this in a mortgage calculator (such as MSE best buys) it tells me they have nothing suitable

Samw here we had plans borrow more and extend.
We have grand room move around Feb half term.
Estimate the move some new floor paint furniture be around 1k.
We did guttering and fences when we moved in.
We did garden in 2020 totally landscaped back.
Exterior badly need a paint and think we need some new roof tiled which we hoped to do this year.
Spending money to reduce energy bills seems sensible so that probably be focus this year as well as pay off credit card.

The predictions change every month.
2024 seems way off need to survive 2023 first.
Think inflation maybe get lower from April onwards but won't instantly be 2% and things still cost a lot just won't rise as fast.

Issue is we looking at increased everything and falling wages.
Mortgage increase on top of other things.

Wish we could over pay a little this year but paying off debt to free up repayment money for extra mortgage money and emergency savings makes more sense .

Sounds like tracker best option for few of us.
As ours end latter end if 2022 but was going to start shopping around in Sumner.
If base rate is 5% then tracker us 6 but if base rate gets upto 6% then my worst case scenario 7% accurate.
I'm guessing maybe optimistically it won't go higher than 5% unless inflation won't go down .

I am a mortgage broker

Fixed rates have been falling since november

My clients whose mortgages are finishing in the next 6 months have been added to a 'lets get ready but not act right now' list where i am monitoring what their lender is doing rate wise but if rates turn i can act very quickly to lock the rates in.

We have almost come back to pre budget rates which are in the 4's rather than the 6's

Been googled and different predictions but some common agreement 4.5% could be the peak and that it won't hit 5%.
But in reality it's a guess OBR been wrong before.

uk.finance.yahoo.com/news/interest-rates-what-to-expect-bank-of-england-2023-060028799.html

That's reassuring to hear.
When best time to contact my broker.
We with halfix but we also bank with Lloyd's / santander and barclays.
We went with Halifax as although status employed its low basic and commission based pay.
Recent change is the basic has increased much higher but the commission structure means could no earnings less on commissions.
Credit rating improved a lot.
My only worry was the mortgage break we took in 2021 worried that go against us.

I've always found London & Country to be excellent at finding good mortgage deals. They take their commission from the lender so there's no obligation on you. Worth a call to check out options.

We are just starting to look into this.

Want to stick with current lender as when we've tried in the past to go with different people we've spent over an hour on the process only to be turned down so sticking with current provider.

Currently on 2.99 and they are offering between 4-5% depending on how long we fix for I can't remember exact figures.

Works out around £100 a month extra. Plus combined with tripled energy bill etc means we are squeezed from all sides ☹️

Hi OP,

It's dropped a lot actually in last few months but yes your payments will definitely be increasing if you were on a low interest.

First part of my mortgage is due to end in April 2023 and when I first contacted my mortgage broker 3 months ago the best price was over £1600pm. (We were paying £960). With how things were then we agreed to do a tracker but have pulled out of this now and fixed in with Halifax at £1200pm (4.46% on 5 year) and will check again in February, March and April before it renews to see if we can get a better price and if we can will swap to another product.

The earliest you can look is 6 months beforehand and if you have a good mortgage broker they will be happy to look at new options every month and you're not tied in until the mortgage starts.

We ported our mortgage years ago and as such it's in two parts. We fixed the first part just before Christmas for an extra £150 a month for five years, and the second part is due in June and now I don't know whether I've done the wrong thing. If we get a similar rate of 5.99 I think, it'll be another similar increase so just over £300 more total a month, but in relation to our mortgage it's massive. It was less than £500 to start with. Really no idea what to do. Bought the house in desperate times, ours had sold and we were living with my parents, our original purchase had fallen through. We now realise we don't actually love it and want to finish doing it up and move on. I don't even know whether that's feasible now. If house prices drop and we make nothing we might not even be able to afford anything similar. Certainly can't afford anything much more expensive. Don't even know whether anyone would lend us more anyway. A year or so ago we were getting agreements in principle for a lot more, I've got a. Second job since then but online calculators don't look promising. I don't know how people will cope. We are lucky in that we had a surplus but it's dwindling quickly.

We've just fixed for 5 years at 4.39% with Leeds Building Society. It's £312 per month more which is pretty hideous but we found that a 2 year fix was a couple of hundred ££ more than that, which was just far too expensive!

I was tempted to go with at tracker but the difference was about £80 per month less so it didn't seem to be worth the risk. I don't think we knew how lucky we were with the cheap rates!

@Ineverwannabelikeyou we ported, so ours is in two parts too. Personally we aren't keen on 5 year fixes as I think rates will come down over those 5 years & also we also want to move like you, once we've finished doing this place up. We like the house we're in and it's in a great area but it's not forever. Hopefully we make some money on it over 5 years as we certainly won't initially! 2 year fixes are currently too pricey so we'll probably go with a tracker when the time comes.

We are in a similar position OP.
Five year fixed rate of 1.89% ends in Dec 23.
Our house has risen in value and we have paid off some, so I am looking 40% LTV.
I'm pleased with that as we borrowed at more like 60%.
This year I am overpaying by £200 per month, and plan to throw an extra £1k at it a few times a year as I go along.
I am hoping to fix for 2 years at about 4.5%. This would bring my repayments to about £200 more than now, the same as I am overpaying, so I'm hoping we won't notice too much difference, though the amount will go down more slowly. Annoying as our term is long, but who knows what will happen in the next 25 years anyway?
5 years ago I was on maternity leave, then returned to work part time with lots of childcare costs.
Now I work more hours, new job with less commute, and the kids are older, so I can afford to pay more.
6 years previously (so 10 years ago) we moved into our first house. We were happy enough then with 3.99%.

Ours ends in April, we've been on a 1.79% five year fix. I've gone for a 10 year fix with the Halifax at 4.04% and extended the term from 16 years left to 20, so repayments are the same (takes me to retirement age). Planning on getting it fully paid off in those ten years though, 10% overpayments allowed (of jan 1st balance).
I ummed and ahhed about discount trackers, going onto SVR or getting a shorter fix but on balance I think this is the best for us. I bloody hate paying £999 fees every time we remortgage! And the SVR was 6.75% and edging higher.

Sounds sensible. I am just averse to planning life in 10 year chunks! I'd prefer not to fix as we nearly got stuck with a worse deal/ would have had to pay to leave our last 3 year fix when we moved. But then we took a 5 year as the rate was so low.

Do you mean a BoE base rate of around 4% or mortgage rates of around 4%?

Mortgage rates usually sit a 1 or 2% higher than the base rate.

@FabbyDab Mortgage rates are expected to be 4% to 4.5% where you lock in for a fixed term of two years. They then revert to standard rates after the two years which, yes, will be higher.

It pays to keep switching your mortgage so you never have to go onto the higher rate - using a broker helps you navigate through this.

I understand how mortgages work in general.
What I was questioning was that if the BoE base rate is currently 3.5% and we are due a few more rises in 2023 taking us up to aprx 4.5% then mortgage rates by the end of 2023 would be around 5.5-6.5%?

@FabbyDab mortgage rates have been going back down despite the BOE base rate going up

Oh really? Does anyone know why? Just out of curiosity.

My deal expires in sept 2023.
I've seen lots of posts about people wanting to fix for 5+ years, but my thought process is, a lot can change in 2 years and surely it's more likely to go down slightly, rather than up in 2 years, so I'll fix for 2 years - or am I being naive?