Base rate over the next two years? Mortgage renewal

[mwg123]

How do you see base rate changing over the next two years? My mortgage is up for renewal in June this year. Currantly on 5.14% fixed. But when my fixed rate in June ends the standard variable rate is just 3.5%. Best fixed i have been offered at the moment is 4.39% over 4 years with a £1200 fee. So any thoughts on base rate and/or better deals on the market.

Thanks as always,

Matt

[JustinP1]

Sky news financial bods say that the base rate will not rise until mid 2010.

On that basis, you need to work out for how many month the base rate will have to be higher, and how much to make it worthwhile taking on the fixed rate.

[Goochie]

I'm in a similar position and have decided to drop onto the variable rate from June and bank the difference. That way I have a "war chest" with which I hop to get through any higher interest rates in 2010 / 2011

[mwg123]

I am thinking the same thing. There fixed rates have quite alot of worst case scenario built in to them surely, so why should a 4 year fixed rate deal change if base rate goes up a point or two. i.e take the variable rate and jump ship when its not viable????

Matt

[Duke of Rothesay]

Inflation is going to rip.

1) Low pound makes imports expensive.
2) Quantitative easing reduces the value of the money supply.
3) Interest rates are too low.

So the BoE will have to push rates up to "normal" levels or even higher. Otherwise pandora's box will have it's lid ripped off at the hinges.
The big difficulty is predicting the time frame.

[Noger]

Charcol are advising people to look at 5 year fixes at the moment, as being the cheapest option over the long term - but a good deal more expensive in the shorter term.

Another option is the "drop lock" which keeps you on variable but with the option to fix if things go up fast (which will happen).

[marctwo]

I'm in the middle of remortgaging now. With the Cristal Ball broken, I decided that I'd rather play it safe and know exactly what my repayments would be. I found a 5 year fix at 4.15% with the Post Office (up to 75% LTV).

[RJE1966]

marctwo said:

I'm in the middle of remortgaging now. With the Cristal Ball broken, I decided that I'd rather play it safe and know exactly what my repayments would be. I found a 5 year fix at 4.15% with the Post Office (up to 75% LTV).

That's bloody good, I'm with Natwest on a tracker that ends 01.01.2010, at present their SVR is 4% anyway!

I'm off to see how early I can 'book' the deal with the post office......

[Obiwonkeyblokey]

me too, was looking at 5 year deals at about 4.6-4.8 but this post office one looks a stomrmer

heres the link for anyone interested

http://www.postoffice.co.uk/portal/po/jump2?catId=...

[anonymous-user]

Obiwonkeyblokey said:

me too, was looking at 5 year deals at about 4.6-4.8 but this post office one looks a stomrmer

heres the link for anyone interested

http://www.postoffice.co.uk/portal/po/jump2?catId=...

Thanks for that, makes me wonder about fixing for 10 years at 5.49%! Although i have this nagging feeling that rates will be high in 5 years time.

[mwg123]

marctwo said:

I'm in the middle of remortgaging now. With the Cristal Ball broken, I decided that I'd rather play it safe and know exactly what my repayments would be. I found a 5 year fix at 4.15% with the Post Office (up to 75% LTV).

Great, Thanks for that!

Matt

Edited by mwg123 on Tuesday 14th April 12:05

[TimCrighton]

HSBC were listing a 5 year fixed (max LTV 60%) at 3.99% last week...

Worth looking at - like you I'm looking at a mortgage but a purchase rather than remortgage and thats the best deal we've been offered. Although we've actually opted for a Chelsea 5 year fixed at 4.19% as it included a free val and thus cancelled out the benefit of the reduced rate when calculated over time.

[Chris_w666]

Was in the Yorkshire Bank (Clydsdale have the same deals) they offered a 5 year fix at 3.99% on Less than 80% LTV.

[anonymous-user]

I was all but signed on a 10 year deal at 5.89%.

Bank phoned today & said C&G would not waiver the ERC even though we are then going back and borrowing MORE ££ at a HIGHER rate. Greedy bds. So, do i still fix for 10 years at 5.89%, fix for 5 years with the fear interest rates will be high when that ends(recession over)or go on a tracker deal & fix once rates start to rise?! Part of me says play safe & fix for 10 years but £145 a month difference is nagging at me for the 5 year deal. Trouble is that £8700 could all be wiped out and more IF rates are much higher in 5 years. Decisions decisions.

[clan]

I always use the FSA website to compare deals . http://www.fsa.gov.uk/tables/ I assume it is impartial.

[scotal]

Dave_ST220 said:

Obiwonkeyblokey said:

me too, was looking at 5 year deals at about 4.6-4.8 but this post office one looks a stomrmer

heres the link for anyone interested

http://www.postoffice.co.uk/portal/po/jump2?catId=...

Thanks for that, makes me wonder about fixing for 10 years at 5.49%! Although i have this nagging feeling that rates will be high in 5 years time.

There is a 10 year around at 4.99% , 65% LTV cap though.

[anonymous-user]

scotal said:

Dave_ST220 said:

Obiwonkeyblokey said:

me too, was looking at 5 year deals at about 4.6-4.8 but this post office one looks a stomrmer

heres the link for anyone interested

http://www.postoffice.co.uk/portal/po/jump2?catId=...

Thanks for that, makes me wonder about fixing for 10 years at 5.49%! Although i have this nagging feeling that rates will be high in 5 years time.

There is a 10 year around at 4.99% , 65% LTV cap though.

I could get into 65% but i want that loot behind me tbh. Looks like lenders aren't going much lower on long term fixes? I need to get this sorted in the next couple of weeks, that PO deal really has put the cat amoung the pigeons for me! It's a tempter..........

[anonymous-user]

clan said:

I always use the FSA website to compare deals . http://www.fsa.gov.uk/tables/ I assume it is impartial.

The FSA are a joke. 'Money made clear' my arse. Yes, they are impartial but their site doesn't show all mortgage options available in the marketplace nor does it give you any professional advice - it's basically a list of 'some' of the mortgages that 'may' be available to you, then you have to decide which is the best and if you fit the lender's criteria.

Rant over

[scotal]

yellowbentines said:

clan said:

I always use the FSA website to compare deals . http://www.fsa.gov.uk/tables/ I assume it is impartial.

The FSA are a joke. 'Money made clear' my arse. Yes, they are impartial but their site doesn't show all mortgage options available in the marketplace nor does it give you any professional advice - it's basically a list of 'some' of the mortgages that 'may' be available to you, then you have to decide which is the best and if you fit the lender's criteria.

Rant over

They also had a slap on the wrists for their site being a bit out of date recently......

[anonymous-user]

The 5.19% 10 year deal i found isn't any help, can only over pay by £499 a month(i need the options to over pay by 10K PA in lump sums). Any ideas?