Long Fix Mortgage Or Short Tracker?

[BikeBikeBIke]

Until today I've always picked the cheapest mortgage *today* and not tried to guess the future. By chance it's paid off long term every time except one.

However, I've got the option of two BTL mortgages:

6pc Fixed until 2029.
6.7pc Tracker until 2027.

Fixing until 2029 feels like a heck of a gamble with an overheating economy feeling highly unlikely.

What does the panel think interest rates are gonna do in future?

[Jonathan27]

There is a greater likelihood that interest rates will go down over the coming few years, rather than up. So I wouldn't look to lock myself in at high interest rates.

[Raptor7000r]

BikeBikeBIke said:

Until today I've always picked the cheapest mortgage *today* and not tried to guess the future. By chance it's paid off long term every time except one.

However, I've got the option of two BTL mortgages:

6pc Fixed until 2029.
6.7pc Tracker until 2027.

Fixing until 2029 feels like a heck of a gamble with an overheating economy feeling highly unlikely.

What does the panel think interest rates are gonna do in future?

I would go down the tracker route, ecb cutting rates, UK/USA likely next. Are you paying heavy product fees? If not you could go 2 year tracker, then look to fix for longer if rates come down.

[Hustle_]

How long before we've seen a 0.75% drop in the base rate? As things stand you'd have to say that's probably within a year.

I think things would get very itchy in 2028 and 2029 on a 6% fix.

[BikeBikeBIke]

Thanks all.

Also it's just occurred to me I'll be 55 in 2027 and it might be prudent to take the TFLS put of my pensions amd pay off some mortgage. Being in a fix will make that rather tricky.

[BikeBikeBIke]

Raptor7000r said:

I would go down the tracker route, ecb cutting rates, UK/USA likely next. Are you paying heavy product fees? If not you could go 2 year tracker, then look to fix for longer if rates come down.

Yeah, there are no product fees.

It's got to be the tracker.

[gangzoom]

How quickly things change, I remember when I signed up to this, some of the ‘advice’ around here was to consider holding out on a tracker as negative rates may be coming……it wasn’t that a long time ago!

[okgo]

I seem to be able to get 4.5% deals - why are you only able to get 6?

[Hustle_]

LTV, probably

[okgo]

Hustle_ said:

LTV, probably

But he’s older, so assumed he wasn’t going to be 90% LTV type person.