New Mortgage
14 December 2006, 12:46 PM
#1
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New Mortgage
The 2% discounted rate on my current variable rate repayment mortgage runs out next month & I can look elsewhere without penalties.
Any ideas on what I should be looking for next? Fixed rate or should I look for a similar offer again?
Cheers,
Darren
Any ideas on what I should be looking for next? Fixed rate or should I look for a similar offer again?
Cheers,
Darren
14 December 2006, 11:25 PM
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Generally it depends on how well you think the existing lenders are reading the market. You can't get half as good a fixed deal now as you could this time last year. The reason - the base rate has gone up, and the lenders expect it will again. They're in it to make a profit, so I expect they'll usually aim to make as much on a fixed rate product as a reduced variable, and they base their projected profit on what they think the rates are going to do over the next year or two (i.e. they expect it to rise a bit). Therefore if you think rates will rise less than the current accepted "average" thinking, get a discounted variable rate. If you think it will rise more than the current "accepted" average, get a fixed.
However, no matter what advice you get on here, you need to pick whichever product is right for you, and none of us can tell you that without analysing your finances.
However, no matter what advice you get on here, you need to pick whichever product is right for you, and none of us can tell you that without analysing your finances.
14 December 2006, 11:39 PM
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Originally Posted by hades
Generally it depends on how well you think the existing lenders are reading the market. You can't get half as good a fixed deal now as you could this time last year. The reason - the base rate has gone up, and the lenders expect it will again. They're in it to make a profit, so I expect they'll usually aim to make as much on a fixed rate product as a reduced variable, and they base their projected profit on what they think the rates are going to do over the next year or two (i.e. they expect it to rise a bit). Therefore if you think rates will rise less than the current accepted "average" thinking, get a discounted variable rate. If you think it will rise more than the current "accepted" average, get a fixed.
However, no matter what advice you get on here, you need to pick whichever product is right for you, and none of us can tell you that without analysing your finances.
However, no matter what advice you get on here, you need to pick whichever product is right for you, and none of us can tell you that without analysing your finances.
Simon
14 December 2006, 11:56 PM
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its dead simple really - as a rule variable rates are off set by lower fees and fixed rates by higher fees - after spending far too long creating spread sheet that calculated the average costs of 20+ mortgages over a 3 year period (
) I established that the difference between the cheapest and the most expensive was about £700 over the three years...even taking into account moderate interest rate increases so nowt to get excited about... In fact it wasn't until month 29 that a variable rate mortgage, with interest rate increases, became potentially more expensive than the fixed rate.
mind you.... thats a ruddy good diving holiday so off to MoneySavingExpert.com ad-free, free to use, Consumer Revenge! with you
p.s. My extensive
research showed that alliance & leicester offered the best deals...
) I established that the difference between the cheapest and the most expensive was about £700 over the three years...even taking into account moderate interest rate increases so nowt to get excited about... In fact it wasn't until month 29 that a variable rate mortgage, with interest rate increases, became potentially more expensive than the fixed rate.mind you.... thats a ruddy good diving holiday so off to MoneySavingExpert.com ad-free, free to use, Consumer Revenge! with you
p.s. My extensive
research showed that alliance & leicester offered the best deals...
Last edited by brumdaisy; 14 December 2006 at 11:58 PM.
you're in here as well, you're like a bad smell tonight.
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