Any recent remortgagers - 2 or 5 yr fix?

[WoolyMammoth55]

Hi all, our fixed mortgage expires at the end of the month and we've had decent quotes to remortgage - 2 year slightly cheaper, 5 year still affordable.

Can anyone who made the choice recently tell me if you wnet for the 2 or 5 year fix, and why? Rates feel like they are coming down slightly, DH thinks we'd be mad to fix for 5, but I feel like the comfort of knowing it's affordable for us no mater what madness occurs in the market is maybe worth paying a bit extra for?

Would appreciate any thoughts!

We fixed for 3 years which will start in November 😅 we were having a similar dithering dilemma, except the 5 year was cheaper than the 2&3 year. We're basically hedging our bets.

We just fixed for 2 years after our 5 yr fix expired. Another 5 yr fix was available but I think it's too up the air right now to commit for so long hence the choice of the 2 yr.

I just fixed for 5 years - marginally cheaper than the 2year fix but I dont have any confidence that the current government plans will enable interest rates to fall any lower. I was so lucky with my last mortgage - fixed at 1.79% five years ago just before the big interest rate hikes so fixing this one at just over 4% for 5 years feels sensible. Hope my gut instinct is right again!

We just fixed for 5 years, was more towards the fact it was the cheapest deal ours has increased but have reduced the term. fixed at 3.80 (from 1.84). We want the certainty and so worried rates will get out of control again dont want to be worrying about it again in 2 years time.

When people quote rates it's meaningless because a 3.8% could have a hefty fee attached to it, which might make it overall more expensive than a 4% with no fee depending on your loan size. Also remember on a 2 year deal you will have to remortgage earlier and potentially pay these fees again. Do some maths and crunch numbers over both deals that you are looking at. 5 year offers security but can be inflexible if circumstances change.

I've just fixed for 5 at 3.69%. I went for 5 as it was marginally better rate than for 2 but mainly as I don't want to continually pay a £999 arrangement fee each time. I do think that rates will come down but on balance, not enough for me pay £999 now and £999 in 3 years time.
If you could guarantee no switching fees I would be tempted for 2 years.

Thanks all - we think we will stay with our current provider and so there's no arrangement fee to factor in. They have very decent rates and are cheaper than the rock-bottom ones once the fees are factored in!

Looks like about 50:50 split on 2 vs 5 years - I will talk it out more with DH tonight and try to make a call... Appreciate all the input, thank you!

We have fixed for 5, largely because it’s a cheaper rate (fee free) and also because the remaining amount is not that high (into the second half of a 25 year mortgage) the interest rate doesn’t really make much difference so we aren’t going to save anything significant by fixing for a shorter term, but could lose out (for context, the switch from 1.9% to 3.9% is costing an extra £80 per month so not exactly painful)

We went for two years (fee free) in the hope that rates might come down a bit

I've just arranged a 5 year fix for my new property - like you, sticking with existing provider, no arrangement fee. For me it's not a huge mortgage so interest changes don't have a massive impact on the monthly repayment, but I like having certainty so a 5 year of entirely predictable repayments suits me. Like others, I figure arrangement fees have got so big nowadays, there's more to lose by constantly remortgaging than being on a slightly higher interest rate for a few years.

We fixed for 5 years too, otherwise it would be variable and an extra whopping £300 per month.

I have just gone for a 1yr fix as I think rates will drop a reasonable amount in the next year.

There is no arrangement fee if you stay with the same provider so I would fix for 2 years then reassess at that point whether to go for 2 years 3 years or 5 years with the same provider again.

Gives you less choice of Lender but saves on arrangement fees & in my experience they offer you a competitive rate anyway as want to keep reliable customers.

Why not the 2 year option?

Less common but not a bad idea as long as you weren’t charged a big arrangement fee.

That was what we did previously and chose 5 this time.

No fee.

We went with 5 years but only because that's what we could afford. We've taken on a hefty mortgage so the certainty is reassuring.

I think most or us thought more significant reductions would have been made already to interest rates but we've seen lots of delays and hesitancy. I'm starting to wonder if they'll go back down much; I mean, I expect they will go down but I'm not sure to 3% like we were expecting.

Yes they are going down slower than once expected but the direction of travel is still downwards. They are widely expected to fall again in November.

Though a 5 year fix can make sense to people that need that financial certainty. No one 100% knows what is going to happen only what is likely to happen.

We've just done a tracker mortgage. I work in the banking sector, and although no one can say what's going to happen, the likelihood is the BoE base rate is only going to decrease which means my monthly repayments will either stay the same and go down if BoE decide to lower the base rate. Depends how risk adverse you are, as obviously if they decide to raise the base rate my monthly repayments would increase, but in all honesty I can't see that happening!!

https://inews.co.uk/inews-lifestyle/money/property-and-mortgages/top-mortgage-deals-pulled-despite-inflation-fall-3331183?

US 30 year on the move upwards once again

https://x.com/barchart/status/1847443865470423378?s=46