Fixed or Variable
Discussion
I'm pretty much in the same position with my 5 year fixed deal (4.89%) finishing at the end of this month. If I stick with my current provider I would go onto their standard variable rate of 3.5%. I've knocked two years off the overall term of the mortgage and gone for a variable rate of 2.19% with a new provider, which will also let me overpay as much as I want without penalty. I think making overpayments is the key.
The security of a fixed rate undertsandably appeals but the as said earlier the base rate would have to rise signficantly before it reached the fixed rates available at the moment. Ultimately, if you knew what was going to happen to the base rate in the future you'd be a very rich man, all anyone can do is make a best guess. I think it really depends on how much money is involved, how stretched you are (i.e. can you weather any significant rises) and what your long term aims are. These are all things that only you can really answer but I doubt that the base rate will raise by more than 1.5% in two years (don't sue me if does!).
The security of a fixed rate undertsandably appeals but the as said earlier the base rate would have to rise signficantly before it reached the fixed rates available at the moment. Ultimately, if you knew what was going to happen to the base rate in the future you'd be a very rich man, all anyone can do is make a best guess. I think it really depends on how much money is involved, how stretched you are (i.e. can you weather any significant rises) and what your long term aims are. These are all things that only you can really answer but I doubt that the base rate will raise by more than 1.5% in two years (don't sue me if does!).
Edited by RedWhiteMonkey on Thursday 14th April 11:00
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