Pay redemption fee on mortgage or stick out to renewal

[Chocolategirl19791]

Our mortgage is up for renewal in April and we will beee to stick with the same provider as we have 2'mortgages thanks to a house move and the other part is on a fixed rate deal and will cost a paid to get out. Currently it would be £2500 redemption fee, trying to work out if it's worth it. It looks like if rates go up by 0.75% or more by January when we can get a new deal (I assume 3 months before the end) the we'd be better of paying the fee and getting a new deal. What's the projections of how much will it to go up and how often do BoE announce rate rises?

Money Saving Expert has a "ditch the fix?" calculator.

As for future interest rates? Who knows. Based on absolutely nothing, I think we'll see a BoE Base Rate of 5% within 5 years.

@Chocolategirl19791 Our 5 year fix runs out in April too. Yesterday in fact we broke out of that deal early, paid a 1% fee to do so, and got a new rate on a 5 year fix. We decided that if the rates continue to rise (which I think they will) we would make that 1% fee back easily. It means I don't have to worry what rates will be in April on top of everything else so at least our mortgage is sorted. The rate we got yesterday was 3.64 which was higher than our previous rate despite having a much bigger loan to value.

Our bank would let us secure a mortgage rate 6 months before your current rate expires and not pay a exit fee, because they said so many people wanted to come out earlier. We could have done this in November but rates are definitely going to increase more between now and then and we just wanted it sorted. Also bear in mind that it took us quite a few weeks to get a mortgage appointment because so many people are doing this apparently.

There are 3 more BoE meetings before January: 15th Sep, 3rd Nov and 15th Dec. I've read several reports suggesting that the next rate rise could be another 0.5%. Also the inflation figures are still terrible.

So if you are certain that a 0.75% rise would make it more cost effective to switch early then I would probably do that in the current financial climate.