Mortgage deal ending

Overpayments will save far more on interest now with the rates going up.

Even if it says 10% pa, there can be terms not stated which allow you to pay lot more without a charge, depending on bank, as some don't count small payments as overpayments (under 3 x monthly payment) so you could pay the lot off in a few months and just be charged a % on the last one.
 
Current situation:

Mortgage 2.19% £606pm

Cheapest fix - 4.51% £804pm
Cheapest tracker 3.96% £755pm

Bank of England announce next base rate change on Thursday, rumored to be up 0.5%. This will increase cheapest tracker to around £800pm (4.46%).

About 6 weeks ago when the base rate was 3%, the cheapest fix I could get was 5.64% £908pm
So despite a rate rise of 0.5%, the rates for fixed mortgages have come down. If they are to rise again, what affect will this have on fixed rates? Is there a usual trend for fixed rates to be a certain amount above the base rate? The fact that the rates have dropped despite the base rate going up confuses me. If the base rate does move to 4%, I struggle to see how a fixed rate could get any lower than the 4.51% I have available today.

Basically I am tempted to fix at 4.51% now, as the tracker is likely to cost at least the same in a few days, and further rises are rumored to follow in the coming months.
 
smevchenko said:
Current situation:

Mortgage 2.19% £606pm

Cheapest fix - 4.51% £804pm
Cheapest tracker 3.96% £755pm

Bank of England announce next base rate change on Thursday, rumored to be up 0.5%. This will increase cheapest tracker to around £800pm (4.46%).

About 6 weeks ago when the base rate was 3%, the cheapest fix I could get was 5.64% £908pm
So despite a rate rise of 0.5%, the rates for fixed mortgages have come down. If they are to rise again, what affect will this have on fixed rates? Is there a usual trend for fixed rates to be a certain amount above the base rate? The fact that the rates have dropped despite the base rate going up confuses me. If the base rate does move to 4%, I struggle to see how a fixed rate could get any lower than the 4.51% I have available today.

Basically I am tempted to fix at 4.51% now, as the tracker is likely to cost at least the same in a few days, and further rises are rumored to follow in the coming months.
Click to expand...
Fixed rates move more in line with what future predictions look like. Current moves are priced in to a degree. There was talk about rates hitting 6% in the UK hence the big jump but now the predictions are 4.5%, then level off, then come down. If you want certainty then a fix is the only option but going for a long period such as 5 years is risky as I can see them being much lower again by then. Tracker will move with the base rate so probably go up before they come down.
 
The fixed and variables are a lot closer, but make sure you look at the overpayment charges on the fixed ones as a lot have gone up, some even charging 5% in the first year.

Some are in effect free for overpayments (above 10% PA) if you pay off smaller amounts, but they don't advertise it. You just need to know the bank.
 
Millwallawayveteran1988 said:
Fixed rates move more in line with what future predictions look like. Current moves are priced in to a degree. There was talk about rates hitting 6% in the UK hence the big jump but now the predictions are 4.5%, then level off, then come down. If you want certainty then a fix is the only option but going for a long period such as 5 years is risky as I can see them being much lower again by then. Tracker will move with the base rate so probably go up before they come down.
Click to expand...
Yeah, not happy about a 5yr fix, but 2 and 3 are £120-£140 more a month
 
I'm fairly certain interest rates will start coming down next year or so.

Petrol and gas getting back to normal hopefully.
 
smevchenko said:
Current situation:

Mortgage 2.19% £606pm

Cheapest fix - 4.51% £804pm
Cheapest tracker 3.96% £755pm

Bank of England announce next base rate change on Thursday, rumored to be up 0.5%. This will increase cheapest tracker to around £800pm (4.46%).

About 6 weeks ago when the base rate was 3%, the cheapest fix I could get was 5.64% £908pm
So despite a rate rise of 0.5%, the rates for fixed mortgages have come down. If they are to rise again, what affect will this have on fixed rates? Is there a usual trend for fixed rates to be a certain amount above the base rate? The fact that the rates have dropped despite the base rate going up confuses me. If the base rate does move to 4%, I struggle to see how a fixed rate could get any lower than the 4.51% I have available today.

Basically I am tempted to fix at 4.51% now, as the tracker is likely to cost at least the same in a few days, and further rises are rumored to follow in the coming months.
Click to expand...
Fix for 5 years
4.51% is still very cheap money and you know exactly where you stand for five years
 
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