Mortgage - 1.99% For 5 Years or 2.89% for 10?

[pushthebutton]

Those are my options.

I just about remember the very high rates of the 1980s. I'm leaning towards the 10 year fix for stability, but if HSBC see fit to offer a 1.99% fix for 5 years they must be pretty confident about the direction of the base rate over the next 5 years?

My repayments are affordable on both, but I would pay a lot less interest over the 5 year fix so it really comes down to what rates will do from years 5 to 10 doesn't it?

Any help much appreciated.

[pushthebutton]

Thanks for the replies so far.

I've considered the 5 year, but over paying as if it were the 10 year rate so that I build up a buffer. I'm pondering whether a change of Govt may affect interest rates over the next few years (incoming!!).

[pushthebutton]

I'm pretty sure that the mortgage is portable, but I'll confirm later today. I've moved a fair bit in the past and it was all with the aim to eventually get where I want to be. I've achieved that now and, although I'd never rule out another house move over the mortgage period, it isn't the plan at the moment.

The lender, First Direct, have been pretty thorough with my outgoings, but at the moment the amount they've agreed to lend is within £20k of my top budget. Hopefully that will increase to roughly match it with further clarification of the 'fixed' elements of my pay.

I really like the idea of knowing my mortgage payments over the next 10 years, especially with a fixed rate of 2.89%, but 1.99% over 5 years isn't easy to dismiss. I'm leaning towards the 10 year deal as it's more of a known known whereas the 5 year deal has an element of the known unknown.