Now is not the time to take out a tracker or variable rate mortgage eh?

[tomskip]

Or perhaps it is. How would I know?

As someone who opted for a 5 year fix at 5% just before interest rates plummeted, I fear I'm not the best person to judge!

What are the financially savvy EDF bods doing for mortgages at the moment?

[tomskip]

Oh sorry meant to put this in the Lounge.

[Jeremy]

Personally I don't think I'd ever go fixed again. I got my first mortgage in 2002 on a 5 year fixed rate, and even though rates rose steadily from 4% to 5.75% during that time, I still would have paid less overall if I'd been on a tracker. And the early repayment charges can be very large.

[tomskip]

Not even for two years at 1.44% Jeremy?

[Jeremy]

That does sound competitive. Maybe worth going for if the booking fee is low and you're 100% sure you won't need to sell in the next two years?

[Loz]

Well, you are betting on the future. Personally I don't think interest rates are going to jump up any time soon (i.e. in the next two years).

I've just plumped for a two year fix. I went for a 1.99% deal, but that was fee-free and we have the mortgage down to a point where that's a better deal than forking out ?1000+ in fees. The three year was nearly a half point more and so I'm betting that interest rates won't go up by more than that in by 2019. I might be wrong, but only the future will tell. The tracker was only a 0.15% better rate.

But, 5 year fixes are good for those on a budget. If you want surety in your outgoings, then maybe they are for you.

[tomskip]

I feel its a gamble that most of us just aren't qualified for.

We flushed away more than ?20,000 on that 5 year fix (gnashes teeth). The 1.44% offer is from existing lender with no fees, think we're going to cautiously go for that. Thanks.

[Jeremy]

Yeah... people often think they're playing it safe with a fixed rate... but to my way of thinking, if you get a fixed rate mortgage then you are gambling that rates are going to rise.

But take anything anyone says on here with a pinch of salt, you're probably already as clued up (or clueless, take your pick) as anyone else on the forum.

[Azalea]

Interested in this discussion. I am just coming out of a 2 yr fixed rate. I had previously been on a 2 year tracker, and opted for the fixed as I thought for sure thought BoE Rate would rise. Obviously it didn't. I now have a choice between 2 yr fix at 1.69 or 2 yr tracker whose monthly repayments would be ?60 a month lower than the fixed. Both have product fees.

[Loz]

I'd get a spreadsheet and do a bit of number crunching, Azalea. I'd calculate the total cost over two years for:

- 2 years fixed at 1.69% + fees

- 2 years tracker @ your tracker rate + fees

- 1 years tracker @ your tracker rate + 1 year tracker at the rate +0.25% + fees

and then do the same with a couple of fee-free mortgages.

With the +0.25%, you have a better idea of the risk as well. Fees can make a real difference.

That should tell you what the difference and possible risk over the two years really is.

[DovertheRoad]

There will be a time in the next few years when a 5 year fix for those with stability and not looking to move is bargain of the century. When they rise they won't be coming back down again in a hurry.

I like fixed rates without fees in the current environment...and got a 2 year at 1.39% recently. The OP's deal is a good one - why risk a tracker if you can fix at 1.44...one of the cheapest rates in history?

[Jeremy]

DovertheRoad Wrote:

-------------------------------------------------------

> There will be a time in the next few years when a

> 5 year fix for those with stability and not

> looking to move is bargain of the century.

Maybe. Can't say with any certainty. Rates are likely to rise very very slowly.

[Loz]

DovertheRoad Wrote:

-------------------------------------------------------

> I like fixed rates without fees in the current

> environment...and got a 2 year at 1.39% recently.

A two-year fix without fees at 1.39%?? Who was that with? The best I could find was 1.99%.

[DovertheRoad]

Lloyds I think? I have five accounts with them including two business ones and think it was a rate for banking customers only.

[DovertheRoad]

And was about 8 months ago....

[Mick Mac]

Private Banking customers can get exclusive deals. You qualify automatically when you move over the road.