Time to fix mortgage?
Discussion
Pat H said:
So is now the time to fix for another five years?
I'm not sure why you fixed last time or why you want to fix again now. At the end of the day, rates fluctuate with little if any predictability and if you "fix" you're just as likely to be a loser as a winner. "Fixing" is really for people who are concerned that the cost of their mortgage could, if floating, rise above their ability to meet the repayments. So by fixing they buy insurance against that risk.For example, a couple of years ago you could choose either a fixed rate mortgage (for a defined period) or a floating rate mortgage with an interest rate "cap" of 0.9% above base rate. Depending on what they chose some customers now find themselves committed to their fixed contract at around 5.5% whereas the floating customers are right down at 2.9% with the potential to drop even lower this week! If that happens their mortgage will cost less than than half what the people who fixed are paying and will be virtually free compared with what people pay on their credit cards!
If you feel like a punt then you could always go for another "fix" but don't expect to be offered rates anywhere near the rock bottom rates which some floaters are getting. There's likely to be fees involved too. No such thing as a free lunch!
Pat H said:
Been on an RBS offset since my last 5 year fixed rate expired about 12 months ago.
Has worked really well.
But can't see interest rates dropping much more after the forthcoming chop.
So is now the time to fix for another five years?
Five year rates are not dipping that fast at the moment, I would be keeping an eye on what is out there, but don't be in a rush. Has worked really well.
But can't see interest rates dropping much more after the forthcoming chop.
So is now the time to fix for another five years?
(BTW you can have a fixed rate offset if you want to keep that facility.)
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