How long are you going to fix your mortgage for?

[MontanaView]

Our current 3 year deal ends in September.

Trying to work out if we should fix for another 2 or 3 years, hoping that rates might have come back down by then, or should we just fix for 5 years and enjoy a slightly better rate now and know what we'll be paying longer term? We don't intend to move in that time.

What's everyone else doing?!

@SpringHasSprungAtLast ah I'm with you, that is extortionate, and another example of how there can be inequality!

I don't think we will see significant reductions in the base rate for a long time now. Mortgage rates might reduce a tad into the summer, but I don't think there will be any significant changes in the next few years. A five year fix is reasonable. I think three years is pointless unless you're planning to move or overpay a lot and don't want the penalties.

Mine is December - will depend on what the rates are at the time.

I just checked my current lender and 5 year fixed is 3.9%, so I feel that is probably worst case scenario? I hope. I am currently on 1.9%.

I agree after reading these replies and doing a bit more research. We went for the 5 year fix this morning.

That's what we've just fixed at. I have previously held mortgages at 4.5 and 5.5% so in the grand scheme of things, 3.9% is still on the lower side, historically.

Our current fixed rate runs out soon. We've always gone for 2 year fixed rates before but considering 5 years this time. 2 years is £130 a month more whilst 5 is £100 more. I am worried that rates will go down and we'll be paying more though.

We've just used a broker and no fee. Also you can opt for mortgages with no added fees but need to do the maths.

We've just fixed for two. It's a hard call to make atm. Wish I'd fixed for 10 years last time now though, I'd be laughing at 1.84%. You just never know what will happen though really.

Me too.... my tactic will now be not to check mortgage rates for the next 5 years

Can I just point out that there's more to this decision than the interest rate element? If you're looking to fix for 5 or 10 years, how certain are you that your circumstances won't change in that time? The longer the fix, the bigger the fee to get out of early if you wanted to. For instance, if you divorce and have to sell the house. If you need to release some equity for a major home repair (e.g. new roof, new kitchen). Even moving house - your mortgage might be portable, but it prevents you from breaking the chain (a situation we never thought we'd find ourselves in but which turned out to be unavoidable in the ridiculous stamp-duty break housing market 2 years ago). A shorter fix is less risk in terms of unpredictable circumstances.

@SpringHasSprungAtLast Don't pay for a mortgage broker.

Martin Lewis of MoneySavingExpert still recommends London and Country mortgage brokers. They are free, they don't charge you. They charge the lender a commission so get their money from them, not you.

https://www.moneysavingexpert.com/mortgages/best-mortgages-cashback/

OP, we also fixed for 5 years last year but at a below 2% rate as we have children in uni until then. I was watching Martin Lewis on his TV show and they were talking about mortgages. The rates we are seeing now are "normal" pre 2008 banking crash rates.

Google shows them at 4% from 2000, hovering around 3.75% at the lowest to 5% at the highest before the crash.

The mortgage people on the show were saying that rates should be coming down a bit starting this summer. We have always fixed, not interested in beating the market, just want to know exactly what we will be paying for the next X number of years due to where we are in life. We have been doing it for 20 years. Usually a 2 or 3 year, occasionally a 5 like now.

We've just locked in to five. Have normally only done two but we know we can afford the jump and want the security, SIL has just done 10.

We fixed for 5, at 4.28%. We don’t plan on moving and would rather know what we are paying. We’ve managed to shave another year off of the term. Felt like whatever we chose it would be wrong though!

As long as I duck under 4% then I can be flexible on the term. 5 years feels about right.

We start a new 5 year on 1 May at 4.05%

Was originally going to be 4.13% but it dropped again just before we signed.

I suspect that after year 3 we may be paying too much but we will be prepared to pay the ERC if it pays to.

We actually have 2 mortgage products on this house and the second fix doesn’t end for another year so we are using that to
hedge our bets and might only put that on a 2 year.

I feel exactly the same, like there's no way of knowing what's the right thing, so a decision just needs to be made and fixing for longer at least offers some security

I was just thinking that. We've fixed now for 5 but if the rates drop dramatically after 3/4 years we could look at paying the early repayment charge too if it works out cheaper

I live in Spain and fixed forever last summer at 2%. I hadn't realised you cant do that really in the UK. It's a relief to know the rate won't change now for the rest of the term (pays off in 2040).

Yes this

Fixed last year for 5 years at 1.89%

If I had to arrange a mortgage now I wouldnt fix for 5 years at the current rate. I would go under 5.

@TreeNaDo I have no option because i need a hefty mortgage and am on permanent early retirement at an early age and living off 100% disability benefits for an incurable disease. High street lenders only accept a portion of the benefits and to get the full amount taken into account I had to use a mortgage broker for off-best mortgage lenders that you can only get through a broker.

Feels a bit of a scam. Good old Martin's tips apply to people who can earn, not the minority like me. I'm the only person I know in this situation!

@SpringHasSprungAtLast I am sorry to learn of your circumstances. Completely shitty. I would still just ask London and Country. We have used them for self employed mortgages too, not just employed with a guaranteed monthly wage. Worth an ask surely? It won't cost you financially although I do realise that it is hard if you are constantly told no.

Remortgage due this summer. Haven't got round to doing a lot of research yet but atm my gut instinct is leaning towards going onto a tracker for a while. I'm not keen on fixing again too soon as I think rates forecast to drop a bit more yet. It's always a gamble. In hindsight I wished we'd fixed for 10 instead of 5 as now we'd be looking at another 5 years of super low rate 😩

Our problem was that with everything else going up too we just didn’t have the cash to pay more per month for a shorter term. The mortgage is going up £250 anyway on the cheapest option (5 year) but was £350+ for a shorter term or tracker. With the electricity (fixed rate ending) and nursery going up 10% too in same month we had to do cheapest option now even if it’s not cheapest long term.

If money were not an issue we’d have gone for 2 years but it wouldn’t work for us right now unless we stopped eating.

On the plus side though we have dodged the expensive electricity for the worst of the CoL increases (really cheap fixed rate about to end just as wholesale is dropping) so it all balances out in the end. You can’t win them
all.

I'm going on a discounted tracker from August. However we have 2 incomes and no children, so will be able to afford it if the interest rates go up. But of course we're keeping our fingers crossed they come down!