Jump to content
House Price Crash Forum
notthereyet

Another Lender Increases Fixed Rate Mortgages

Recommended Posts

That means 31% took out trackers. What sort of loon takes a bet with a tiny 0.5% upside and an unlimited downside! :blink:

I guess it depends how much lower the variable rate is than the fixed rate to start off with. You are betting that rates won't rise by more than the difference between the two on average over the term of the loan.

Once example I looked at recently was to choose between a 4.69% tracker and a 4.99% 5 year fix. Clearly you should take the fixed rate in this case.

Share this post


Link to post
Share on other sites
No, you're right. I was being foolishly unsophisticated. Partly, it's because I have never bought one of these two/three year deal mortgages. I tended to get lifetime trackers, because I was subsidised by my employer on a comparable basis, but I can't imagine ever getting a mortgage again now, subsidy or no.

Another reason might also be that for some products the tracker gives you more flexibility - for example, in terms of overpayments. In the past I opted for a tracker, because I had some future bonus payments that were due and I wanted to ensure that I could pump them into the mortgage without penalties. Sure, you can roughly receive the same result with an offset mortgage, but at the time that option was not so attractive.

Share this post


Link to post
Share on other sites
That means 31% took out trackers. What sort of loon takes a bet with a tiny 0.5% upside and an unlimited downside! :blink:

Just goes to show people are still into bricks & mortar. We still haven't had capitulation in the housing market, that will come with higher unemployment and higher interest rates.

Share this post


Link to post
Share on other sites
That means 31% took out trackers. What sort of loon takes a bet with a tiny 0.5% upside and an unlimited downside! :blink:

The sort that can afford to pay the tracker at the current rate and can't afford to pay the "expensive" fixed deals at 1% over the variable.

I am going fro HSBC's 4.24% fixed rate, although the reservation fee is £1299.

Its a good rate IMHO, fixed for years.

I expect rates to be considerably higher in 5 years time and I hope to have made some real progress on the capital by then.

Share this post


Link to post
Share on other sites

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now

  • Recently Browsing   0 members

    No registered users viewing this page.

  • The Prime Minister stated that there were three Brexit options available to the UK:   288 members have voted

    1. 1. Which of the Prime Minister's options would you choose?


      • Leave with the negotiated deal
      • Remain
      • Leave with no deal

    Please sign in or register to vote in this poll. View topic


×

Important Information

We have placed cookies on your device to help make this website better. You can adjust your cookie settings, otherwise we'll assume you're okay to continue.