| Archive for Downsizer For an ethical approach to consumption |
| sean |
Asking you lot's as good as asking anyone else...What do you reckon's going to happen to interest rates over the next five years? We've got a comfortably small mortgage, currently on a discounted variable rate. It's not worth us going for anything with an arrangement fee because nothing available is going to wash its face financially. Our current lenders will let us move to a five year fixed rate for nowt. 5% early repayment fee, but we're not going to move and the rellies aren't crumbly enough to make that a problem.Over to the downsizer economics panel... |
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| Northern_Lad |
Double your mortgage and give me the extra cash, which I shall invest for you.
Interest rates with probably be a touch lower in 5 years, although I can't see much of a movement unless something global happens. |
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| marigold |
What is the fixed rate they are offering? | ||
| sean |
About 6ish, bit more than we're paying now, about 1% below their SVR. | ||
| Jonnyboy |
They know that people need to service their debts, so interest rates are unlikely to rise, inflationary pressures of fuel and food mean that they are unlikely to fall much.
I vote for little change in the rates. |
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| marigold |
Around 6% for 5 years looks quite standard (with fairly hefty fees).
http://www.moneyextra.com/mortgages/bestbuys/best-fixed-rate-mortgages.html# Personally I wouldn't want to be tied into a fixed rate for 5 years and I don't think the banks would be offering the deals if they expected rates to go up significantly, but if you are allowed to overpay it might be helpful to have a fixed rate and increase your payments each year if your income expands to allow that. |
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| Mrs Fiddlesticks |
we've got a tracker one.
As to what the interest rates will do I sense there'll be no quick surprises. Slow changes, possibly upwards actually. There was something in the weekend papers about a suggestion of raising the target inflation rate since the 2% its suppose to be at looks more and more difficult (ridiculous) to maintain or even reflect the true picture What I do think will happen though is that lending criteria will be much tightened and it will be harder to change/ get new mortgage. This is already in evidence Reducing all debt (especially non mortgage type like credit cards, loans etc) sounds the best course of action over all. If you can overpay to reduce the mortgage so much the better. |
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| bernie-woman |
I agree with Jonnyboy - hope I am not proved wrong 
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| Treacodactyl |
Re: Asking you lot's as good as asking anyone else...
I'm not really sure, probably not much. I can see the inflation target of 3% being relaxed and a reduction in rates if house prices fall too much and a recession takes hold, especially nearer the general election. If the credit crunch sorts itself out then base rates don't need to change for the mortgage rate to fall as they are higher than they should be at the moment. At the end of the day your provider will expect to make some extra money on a fixed rate deal to compensate it for the extra risk it's taking (or whoever is providing your lender money will). So, they believes the rates will be, on average, less than they're offering but do you want piece of mind or can you gamble a little? Not sure if this is any more help? http://www.moneysavingexpert.com/mortgages/fixed-discount-mortgage-guide |
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| Barefoot Andrew |
My mortgage is at 5.99% fixed for all ten years of its term. I intend to pay it off well before that timeframe is up...
A. |
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| sean |
Re: Asking you lot's as good as asking anyone else...
I'm leaning towards the security at the moment. Our income is unlikely to rise massively in the next five years. If it does we can over pay anyway. The fact that there's no arrangement fee in this case shifts the sums in our favour a bit, especially looking at the fees on marigold's link. (I know that you can roll them into the mortgage, but that's bloody daft in our position.) |