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Original poster

Fixed Term Mortgage

6 replies

lee12345 · 27/09/2022 09:41

Our fixed term is due to end May 2023, with the rising interest rates we are already looking at a rise of £150 per month. Our current deal, we can pay an early redemption of £1300 & lock into the new deal for 5 years, paying an extra £130 per month.
Just wondered what other people are doing re mortgages? Are you waiting it out to see what rates will be? Or changing asap Incase the rates increase even more.
Many thanks

OP posts:
PronounssheRa · 27/09/2022 09:49

Bloomberg are reporting that the markets are betting on 6% interest rates by November next year. But its all just predictions and its all pretty unstable at the moment.

I would act based on my appetite for risk - do you want some certainty and if so how much are you willing to pay for that?

DizzyingHeights · 27/09/2022 10:13

We are in a similar position, but ours ends in February.
Mortgage offers generally last for 6 months. So if you get an offer the end of this month, it would cover you till the end of your current fixed term. At the end of March as your current fixed term ends your new one can start, saving paying the redemption fee.
The best option would be to speak to a broker that covers the whole of the market and they should be able to help.

DizzyingHeights · 27/09/2022 12:46

DizzyingHeights · 27/09/2022 10:13

We are in a similar position, but ours ends in February.
Mortgage offers generally last for 6 months. So if you get an offer the end of this month, it would cover you till the end of your current fixed term. At the end of March as your current fixed term ends your new one can start, saving paying the redemption fee.
The best option would be to speak to a broker that covers the whole of the market and they should be able to help.

My bad, thought the original post said March not May

Thenightwemet16 · 27/09/2022 20:41

Our previous five-year fix ends next month so we were lucky to get a 10-year fix last month at 2.76 (an increase from 1.76). Fortunate that it's only about £40 per month more than we were paying previously. We have 20 years left on mortgage but we overpay each month so hopefully we will only have a few years left when the fix ends.

Cally70 · 27/09/2022 20:50

@lee12345 I would make the most of the lower rate now and overpay as much as you can afford to/are allowed to

RainingRubies · 28/09/2022 00:15

My bad, thought the original post said March not May

You're right though - lock in the lowest rate you can now, do all of the paperwork and then transfer to it before the offer expires (so minimising your early redemption charge at the same time as securing the lowest rate you can at today's rates). By the time you move you'll only have a couple of months left on your fixed rate so most lenders wouldn't levy an early redemption charge anyway, and if they do the later you do it the lower it will be.

Whatever you do, do not "wait and see". Rates are only going to rise. Currently there is turmoil and many lenders have pulled offers. It may calm down but rates are not going to go down in the medium term. And by applying you're not committing to move anyway, just having it in place.

What you do not want to happen is being moved to the SVR next year and no certainty at all on what you'll pay month to month.

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