My fixed term mortgage ends in a few months - would type of mortgage should I go for?

[MissisBoot]

I am coming to the end of a 5 year fixed mortgage at a super low rate with one of high st banks at the end of this period it will automatically go onto their standard variable rate which will be loads higher than my current fixed rate...

So, given the current financial climate what would you do?

Fix for 2 years?
Fix for a longer term?
Take out a short term tracker/discount?

My monthly payments are going to increase quite a bit but if I increase the mortgage term this will come down, but as the ultimate goal is to actually pay off the mortgage before I retire is that not a good thing to be doing?

Any other options that I'm missing out on?

I'm not planning on moving in the next few years.

Any advice oh wise ones?

Fixed mortgages guarantee what you will be paying monthly.. but (this from DH) the LIBOR rate at the moment is very high and the rates aren't quite as competitive..

See what offers the existing bank will give you - sometimes the fees and other costs involved in changing mortgage supplier negates the savings .. banks are doing everything to claw back some profit..

There are lots of websites to get an idea of what is available

I have been told that in difficult economic times like these, the best savings is to try and decrease your debts and paying a bit more on a mortgage saves £££ in the end...

We had a 2 yr fix that ran out 9 months ago, we decided to go for a 2 yr tracker as there were no decent fixed rates around - or if there were they had high fees attached.

Having spoken to our IFA, there really are not so many good deals around at the mo.

The other thing that we have been doing is making the odd overpayment to the mortage and reducing the term rather than the monthly payment (as we can afford standard monthly payment atm). Our mortgage allows us to pay up to £500 a month without redemption fees. May be something you could consider?

I have seen a 10 year fixed term - would that be too long do you think?

I wish we'd fixed for 10 years before - oh with the benefit of hindsight!

Can I see myself living in this house for another 10 years?

Yorkshire BS were offering a 5.29% fixed for two years. Its the lowest I've seen - I saw it advertised just over a week ago so it might be gone by now. Worth a call and you could book it.

Check out what your current lenders standard variable rate would be. I'm not sure if it is the one quoted when you took out your mortgage, but we found that by leaving ours and automatically going onto the SVR, we were paying the same or less as the better rates being offered currently (and no fees to bump it up).

Fixing for 2 yrs can be costly as once you pay the fee you aer no better off than on the standard rate.So worth checking that

We still have 20 years left - went back to a 25 year term on this mortgage.

I guess the redemption fee wouldn't be that much once that amount of time had passed.

I think we were very lucky to get buy when we did and I'm not convinced that rates will be that low for a v long time.