fixed rate : fix for 2 , 5 or 10 years?

[Lulumama]

Will have 12 years left to run on the mortgage when we renew in September time. We have had a fixed rate of 4.99 % for almost 4 years.
We will stick with a fixed rate for sure, but are better deals available on 5 year deals than than the 2 year ones? any point or value fixing for 10 years or even the whole 12 years?

or is the financial situation too odd at the moment to know what is the best thing?

btw the bank of england admitted interst rates had been kept unusually low and had even been reduced in order to prevent the market crashing in 2005 but knew it was unsustainable.We are seeing the results of this now

paulayates that is not a good attitude.By living off debt i mean the thing that has kept the economy going for yrs is people taking equity out of their houses and buying luxury consumer goods This has been possible because of low rates

not true for us noddy

one huge (ridiculous) mortgage to buy our dream home and no other debt - no house full of consumerish things

as long as you can afford it ergardless of rates and other living expenses that is fine.Only a problem if you need to sell and are in negative equity

Governor of B of E also said - back in 2006 well before the market peaked - "the level of house prices still seems remarkably high relative to average earnings or average incomes or anything else you could look at".

We are taking out a five year fixed atm. And it does begin with a 5. We had a five year fixed when we first bought our house. It saved us money for a long time, though as interest rates dropped it became slightly more expensive. The great thing is though - you know whats coming out each month and have the security of not watching the news nervously! Our mortgage is going up quite a bit when we move though we are paying off all our personal debts at the same time so the security of a fixed is very important to us. In five years time dd3 will be at school, I can work more and pay out less for childcare and we should be ok come what may!

get a deal sorted quickly...

my mum is a mortgage advisor for C&G... there rates have gone up 3 times in the past week and also the income multipliers are falling

they will not lend a penny to anyone at all with a poor credit history either

a few months ago it would not have been a problem...

like the rest of the lenders they have pulled there 100% mortgages (not that you would need one) and apparently at the moment the lenders are all upping their rates so they are not the most competative as many banks dont want to lend money at the moment...

all happened in the past few weeks / even days

our deal is sorted thanks - the offer should be through any day. Will be glad when we complete though!

northernlurker - your mortgage is over £500,000????

(hopeful emotion!)

sorry no - not even close to that.

ahh well!!

i can always dream!

Having looked into this myself very recently, the long fixed rates actually can really make sense. A lot have a chance to pay off without an early redemption penalty every 2 yrs (they are all obvs slightly different) so if the rates did drop significantly lower (which I find hard to believe, I remember rates of around 12%!) you could change.

Unfortunately i've found myself in a bad predicament. I'm what they call a sub-prime borrower or whatever the term in. In the whole time i've had my current mortgage i've never defaulted yet since the rules have changed I can no longer re-mortage despite some equity (and take advantage of a fixed term again) and i'm about to have to pay the standard (higher and may get a lot higher still) rate.

PaulaYates -

"I keep seeing this on here"

I assure you MN is not the only place people are talking about how interest rates have been very low over the last couple of years, with regards to where they were before.

"since when is the last 8 years 'recent' in financial terms?"

I have been a financial analyst and then a fund manager for more than a decade, and I can assure you that use of the term 'recent' depends on the time frame you are using. Interest rate data I provided is from 1975 to today. Couple of years IS 'recent' in that context.

"it has been 8 years since interest rates were above 6%"

Average base interest rate was 5.74% in September 2007. That is 6 months ago

"When did bank of england take over control from chancellor ?"
"when did we join emu?"

Err... What are you on about?

"doom mongers"
"Yes the market is unstable but there is no need for hysteria"

If you have reason to believe that (1) lenders are not clamping up and days of easy money will continue, and (2) interest rates are not at historically low levels please do share.

If not, wake up and smell the coffee.

halifax are pulling many fixed rates increasing IRs and raising deposit required as of Monday.This is reality not hysteria the cheap credit has dried up and teh reason they will only lend 75% of value is because they are covering tehmselves for when prices drop.

does that impact on first time buyers or people like us who are changing mortgage deal?

i know that we won;t get as good a deal again, am glad we are not in the position of buying for the first time or trying to move right now

do you think it is worth just calling the morgage company now and asking them if we can refix with them now for 5 years?

when does yours run out lulu?

september

bump for any more opinions

I would ring them monday and ask what their adsvice is for xisting customers HTh

thanks noddy. will take it from there .

lulu, did you see HSBC are on the brink of offering mortgage renewals and matching your previous fixed rate which sounds promising.
However, who knows how much the fees will be for this.

voila

Lulu an advisor on tv last night advised a couple who's rate was up in Sept to look in July and also told them he thinks rates will have gone down by then ?