Mortgage up next month - fixed or tracker best?
Discussion
I need to get my act together and remortgage. Thinking of extending term to 30-35 years to keep payments lower.
I am tempted though to go for a 2 year tracker, what’s the thoughts on this? May be 1 or 2 more rises and then hopefully fall?
2 year Fixed coming in at 5.99% with no fee
2 year tracker 5.39%
I am tempted though to go for a 2 year tracker, what’s the thoughts on this? May be 1 or 2 more rises and then hopefully fall?
2 year Fixed coming in at 5.99% with no fee
2 year tracker 5.39%
Putting crystal ball gazing to one side (nobody here has any special insight into which way interest rates are going to go):
The way to think about this is how the various outcomes would impact you. Let’s say you go the tracker, and then rates rise to 6.5% - are those payments manageable for you or does it mean severe belt tightening? If severe belt tightening, then you might value the certainty of a fixed rate more.
Assuming you can easily absorb cost increases, you’d want to model how much rates would have to fall (and on what trajectory) for you to break even. So for example, if as you predict there’s 2 more rises and then a steady fall, how much would that actually save you vs the fix? Model this in excel.
The way to think about this is how the various outcomes would impact you. Let’s say you go the tracker, and then rates rise to 6.5% - are those payments manageable for you or does it mean severe belt tightening? If severe belt tightening, then you might value the certainty of a fixed rate more.
Assuming you can easily absorb cost increases, you’d want to model how much rates would have to fall (and on what trajectory) for you to break even. So for example, if as you predict there’s 2 more rises and then a steady fall, how much would that actually save you vs the fix? Model this in excel.
Supernova190188 said:
I need to get my act together and remortgage. Thinking of extending term to 30-35 years to keep payments lower.
I am tempted though to go for a 2 year tracker, what’s the thoughts on this? May be 1 or 2 more rises and then hopefully fall?
2 year Fixed coming in at 5.99% with no fee
2 year tracker 5.39%
House value, loan amount remaining, years remaining, current payments. These can help people give you some advice. I am tempted though to go for a 2 year tracker, what’s the thoughts on this? May be 1 or 2 more rises and then hopefully fall?
2 year Fixed coming in at 5.99% with no fee
2 year tracker 5.39%
Plenty of info on this, on the other similar threads (at least half a dozen). Until today the betting was firmly against more than 1 raise (if that). If we are looking at a rerun of 1973 given the ME may kick off, there is NO way anyone can tell (in a way that will help you decide). Firmly in lap of the gods and hope that some form of commonsense breaks out.
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