How long are you going to fix your mortgage for?

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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?!

We've just gone for a 5 year fix of 3.94% starting on 2nd May

I think the super low rates we've had for the last 10+ years aren't the norm so quite happy to get under 4%

Just to clarify, am hoping that a few posters have just misused terms in relation to some of their info.

Those talking about trying the variable rate rather than fixing. Am hoping you mean a tracker rate (usually for two years with no early repayment charge). This is BoE base rate plus a percentage point decided by your provider.

A variable rate is completely different - it’s a rate set solely by your provider and is rarely cost effective. It’s usually what you move to if, at the end of your current term, you don’t secure a new fix or choose a tracker product.

Apologies if I’m teaching granny to suck eggs. But it’s not a good idea to just do nothing and move onto an SVR (standard variable rate).

My mortgage is up for renewal at end of May. I was concerned around Oct/Nov last year at the way rates were rising. To the extent I played around with numbers to see if it was worth paying a few months ERC to secure a new deal then, as was dreading how much further they’d go up.

In the end, I decided to hold fire. I looked at rates a few weeks ago and my best offer was around 4.2% (compared to around 5.5% a few months ago). The following day, the rate dropped to 4.04% and I applied. This was for a 5 year fix. I’ve got until 3rd week in May to cancel that offer and reapply. Have just checked and current rate on that fix is now 3.99%. I’m now seriously considering looking at the 3 year fix rate at my cut-off point in a few weeks.

Have always fixed for 5 years in the past, but I’m going to be paying a close eye on this one.

@LittleRedYoshi was wondering how a ported mortgage affects the chain when selling/moving? @LittleRedYoshi was wondering how a ported mortgage affects the chain when selling/moving?

My fixed rate ends in July this year. Gutted to say goodbye to my 2.18% rate.Cheapest rate for me is 4.16% which means mortgage goes up by £120 a month. Tracker rate seems really expensive as would be £200 and something more so have discounted it. I can do 4.1% ish for 2/3/5/10 years. There are few free fee options and it’s slightly cheaper to go no fee over 2/3 years but with a fee over 5+ years. I’m hoping to sell off an outbuilding at some point but I think I could stay with the same mortgage as it’d effectively be going from 85% equity to 70% equity.

If they said no to that I’d rather the two years but I’m very risk averse so am concerned rates will rise again. Oh for a crystal ball.

My fix is due for renewal in September and there is one thing I just don’t understand. How is it possible that some fixes are way below BOE? For instance, I checked and apparently it’s possible to get a fix for 3.84% with my current lender now, but BOE is 4.25%? How’s so?

It depends on the lender as to how a ported mortgage works. All will require new credit checks and affordability checks to ensure you're not overstretching yourself though. Some lenders will require an immediate transfer to a new property others will give you a grace period. Of course the trouble is not many of us know we will want to move when you take a mortgage out on our current home.

Lenders rates are not all based on BOE base rate. Back in the day they were based on London interbank offer rate (LIBOR). Now still on a similar basis but what it basically means is the rate of interest banks are willing to give to each other.

There are much better explanations online than I can give (I've moved onto protection advice only from mortgages), like here:

@Toooldtoworry
cheers, it is interesting. Wasn’t aware the BOE rate isn’t driving the rates solely…
i may secure the rate now and see if it falls any further before my fix is up.

My fixed rate (1.08%) is up in July. It's the last 5 years of the mortgage so I've fixed for 5 years at 3.8%. I just don't want to have to think about anymore.

I think the size of debt comes into this decision. If rates dropped to around 2.8% in 3 years time I'd be overpaying by £45 a month. Annoying but not the end of the world. I'd be far more concerned if my loan was larger though and each percentage point drop meant I was significantly overpaying.

If you're in a chain (i.e. will be completing on your sale and purchase on the same day), porting your mortgage makes no difference - but being in a fixed term means you might face a hefty repayment charge if the chain becomes broken.

Our situation was that a couple of years ago, we had to move house due to circumstances when we were less than 2 years into a 5 year fixed mortgage. It was during the stamp duty holiday and the housing market was crazy, with demand far outstripping supply, everything selling for far above asking prices, etc. We made good offers on 3 houses but lost out on all of them because the vendors kept choosing buyers in a better position than us. As I said - we had to move, and ultimately the only way we could get an offer accepting was by breaking the chain to put ourselves in a competitive enough position. This meant that even though we were porting the mortgage, we had to pay it off from the proceeds of the sale, plus the hefty early repayment charge (you can't keep the product going while you have no house to secure it against and no guarantee for the lender that you ever will).

We were lucky in that we managed to complete on a purchase within 180 days of the sale, meaning we could then resume the ported mortgage and got the ERC back. Had we failed to do that, we would have lost the money - so it was very much a gamble, and required us to find the money for the ERC on top of all the other costs of selling, buying and moving. Had we been in a shorter fix, the fee would have been far less.

And it's easy for people to say, "Well that doesn't apply to us because we're not planning to move" or "We'd never break the chain", but we never anticipated being in that situation either - nobody has a crystal ball.

We just fixed in for five years a few months ago and I'm so glad. Can believe how much our mortgage has gone up in 2 years considering our value has increased significantly (on paper valuation) and LTV much better. Can't take the risk of that happening again and affordability being tight.

My mortgage is up for renewal in May and we have opted for a 4.18% two year fix. I don't believe mortgage rates will go down below 2% again but I do think there will be a small reduction to settle around 3%ish in a couple of years time. This just gives us the flexibility to remortgage then.

They don’t, but then you just suck up the charge. I’ve paid it twice, we move a lot. Sometimes porting has worked in our favour and others not. It’s not the end of the world in the grand scheme of things, in the context if the overall mortgage I can’t get overly excited over less than £10k difference over 25 years.
We have “wasted” a hell of a lot on stamp duty too. But we have ultimately ended up in the house we always wanted, but we had to do some frequent unplanned moves to get there.

Great that you're comfortable to write that kind of money off - but for us and many others, it would have been hard to swallow. It's a similar ballpark to the cost of making the wrong decision about the rate to fix at or how long for, and if everyone on this thread could afford to just suck that up, we wouldn't all be here talking about it in the first place.

I think you are missing my point- noone knows whether they are making the right decision or not with fixed rates. Sometimes you win and sometimes you lose. Fixing for 5 years and having to move unexpectedly can wipe out any gains, the market does unexpected things in response to external forces and all the predictions go out the window. My point is there’s really no point agonising about it, you just have to make the best decision now for your circumstances and see what happens.

For us right now keeping our payments as low as possible is vital, we are in the final throws of nursery fees and can’t afford a tracker or 2 year. Probably though the last 2 years of our fixed will be paying too much. But the £100 difference right now matters more to us.

We shouldn’t have ported our last mortgage in 2022 and should have taken a new 5 year instead. But we didn’t. When I moved unexpectedly in 2018 we had to pay ERC, but it was worth it to get a really low rate on the new mortgage- we won overall but the ERC dented the benefit. But there’s no point losing sleep over it. There were mumsnetters madly securing 5% rates last year for security that are now paying too much. But they did what they thought was right. It’s all a gamble.

There’s only so many What Ifs you can consider and property should ultimately be about having a home and not £. If life changes direction and requires a move again then any losses or gains are what they are.

We ate fixed until 2030, at 2.29% always do for aa long as poss, worked well for us so far and we know what need to pay, can't deal with finding Morland like stability, hoping to get another 5yr fixed at 2030 and will be able to pay off before it comes to end