2 year fixed or 5 year fixed?

[ilovewinterpansies]

Not sure whether money or property is the best place to post this - am starting here!!

Thoughts on whether you'd chose a 2 or 5 year fixed?

I chose a 5 year fixed in 2011 and it cost me dear as interest rates kept dropping despite the predictions. Obviously at the moment, everything thinks rates will rise (they won't fall). But will they rise enough to make it worth the price of a longer term fixed product?

We have enough wriggle room to absorb interest rate rises comfortably I'd say. I'm tempted to go with a 2 year fixed....on the mortgage we are getting, the cost benefit is £200 a month.

Thoughts?

I don’t think interest rates will change much in the next few years so I’d probably go for 2 years.

I went for 5 years recently. I don't think that the rates will drop much further (I've been stung before!) and also with the unsettled feeling re brexit etc I wasn't sure if that would have an impact on the deals that would be available in 2/3 years time.

This is such a tough choice! I always think that whatever you choose is the wrong choice! We’re in the same boat really and I’m leaning towards a 2 year fixed, we’ve been stung in the past too.

Depends on the interest rates of the deals you are offered. We opted for a 5 year fixed as it was a good interest rate and rates are only going to go up in the next few years not down

We've recently gone with a 5 year fixed to avoid any upheaval over Brexit.

We've about to move and have opted for 2 5 year fixed (one BTL, one residential).

Mortgage advisor very convinced that rates will rise fractionally and we are unlikely to get a better deal.

Given how low rates are though you can't really go that wrong as I also think they aren't likely to rise dramatically inside 2 years.

I was also bearing in mind though that we might have temporary marginal drop in income soon and so might not get such a good offer in 2 years if that happens - fixing for 5 years means no need to remortgage until income level restored! Obs the bank doesn't know this

I think Brexit is the big elephant in the room here. If we do end up paying more for imported goods because the £ falls against other currencies, it is likely inflation will go up again. This may lead the Bank of England to put up lending rates. Fuel has just seen a big hike in price and this affects everything too. Holding inflation down is likely to be a big headache.

Even small rises in interest rates means quite a hike in repayments. I think I would take the 5 year deal.

Sorry - I meant to add: I would look at what your mortgage would look like adding 1/2% increments on the interest rate to know how much it needs to rise before you are better off. Then decide.

I went for 5 years last month to give some certainty as we ride through the Brexit storm. I didn't fancy trying to renegotiate in spring 2020 whilst we're still in the transition period.

I went for 5 year fix 2 years ago, seemed like a good call at the time as I think interest rates will only go up. It was only £20 a month more than the variable and I felt it could go up more than £20 if interest rates changed.

We’ve just gone for 5 yr fixed for all the reasons mentioned above.

Plus in five years my youngest child will be 6 1/2 and firmly in school so we won’t have any childcare costs.

In 2yrs we’ll still be paying most of my salary for childcare so won’t be able to weather an interest rate rise so easily!

We went for 10 year fixed last summer. I am petrified about Brexit.

how long is Mark Carney's contract? As long as he is running the show interest rates won't move. Brexit not relevant as long as he is in power.

inflation is of course well over 5% , it is just that the figures are fixed so it doesn't show. We are in deeper shit than we think and have been for years.

special according to Wiki it's 8 years, renewable once.

@specialsubject can you expand on that? It's all a bit beyond me at the moment.

Have you looked at capped mortgages? At least then you'd benefit if rates drop but won't get stung if they go up massively.
We have just signed up for a 5 year fixed deal with Halifax, with 6 years to run in total. We're planning to overpay so that we actually become mortgage free in less than 6 years.

Marking place

Carney is leaving end of June next year.

We have taken out a small mortgage to do the kitchen and bathroom.

Our original fixed rate mortgage runs out in February and only needs £10 a month to service it.

Anyhoo I digress, we have taken a five year £30 k mortgage and aim to have it gone by heavily overpaying in just under three years, we will hold a tiny amount back to take it to the end of the five years, is that something you could do ?

We opted for 10. It's not like interested rates could have gone any lower, at the time.

We had the choice between 2 and 5 years not a massive difference in price. We went for the 5 year one.

We fixed for five years in April 2016 - just in case the Brexit campaign won..... It was just caution at the time, but as the only way interest rates can go is up and who knows what will be happening this time next year, I'm glad we did.

I've recently fixed for 5 years. I think it depends what interest rate you're looking at. The one I fixed on is unlikely to get any lower, so can only be beneficial.

Can you all please tell me what rates your 2 and 5 year fixes are at what LTV.

I have an offer - a 5 year fixed at 1.94%. 75LTV. Expires by end of July though so I need to complete by then.

New one (no immediate time limit) offered is 2.09% (5 year term). Or 2 year fixed at 1.64%.

Santander. Apparently 70 and 75LTV is the same with them rate wise.

Basically I can push for completion by July (unlikely - long story) or let it go into August and then pay the higher 5 year rate. But I wonder if a 2 year would be better given where we are now. I had expected interest rates to have risen by now and they haven't.

Thanks all for your input. Lots to mull over. Maybe I'm overthinking things especially as we could afford a rate rise. I hate overpaying on stuff like this. I'm inclined to go with 2 year fixed and take my chances!!