Mortgage interest rates.

Joey the lips

Hi Folks

Looking for a pce of advice. my massive 3 year interest rate of 4.75% has just come to an end. As expected I received a letter from my bank asking me i wanted a new rate or to go variable.

Now the variable rate is 2.63%

The fixed rates start off at

4.05 - 3 year

4.6% - 5 year

5.1% - 10 year

My instinct is to let it ride at variable. The way I hear it is even if there is a rate increase it will most likely be half percent which is 3.25% still a long way off 4.05. But then i hear economists say that the cost of money is far to low at the moment and will have to increase to stimulate investment.


What would your opinion be

Stay variable and risk the rises

Go fixed for 3 years and sleep easier with less money...

Advice appreciated.

Priapus

Joey the lips wrote: »

Hi Folks

Looking for a pce of advice. my massive 3 year interest rate of 4.75% has just come to an end. As expected I received a letter from my bank asking me i wanted a new rate or to go variable.

Now the variable rate is 2.63%

The fixed rates start off at

4.05 - 3 year

4.6% - 5 year

5.1% - 10 year

My instinct is to let it ride at variable. The way I hear it is even if there is a rate increase it will most likely be half percent which is 3.25% still a long way off 4.05. But then i hear economists say that the cost of money is far to low at the moment and will have to increase to stimulate investment.


What would your opinion be

Stay variable and risk the rises

Go fixed for 3 years and sleep easier with less money...

Advice appreciated.

Tell me Joey, did you ever see Elvis messing around with....you know the drugs?

A Committments flashback there...anyways...

Variable rates only have one way to go as I see it - up. And that is starting to happen. Fixed for 3 years is a no brainer to me. Sure it's still higher than as the SVR stands now, but you will be saving 70 basis points from what you had been paying. And you don't have to be worries about future uncertainty / hikes, you can plan your expenditures, and basically have peace of mind for the three years.

Joey the lips

Priapus wrote: »

Variable rates only have one way to go as I see it - up. And that is starting to happen. Fixed for 3 years is a no brainer to me. Sure it's still higher than as the SVR stands now, but you will be saving 70 basis points from what you had been paying. And you don't have to be worries about future uncertainty / hikes, you can plan your expenditures, and basically have peace of mind for the three years.

Thats not really the advice I am looking for. Thats just common sense. Foe example at the moment the variable is nearly 1.5% behind the lowest fixed so is a 3 point rise in 3 years likely.

perhaps. Whats the likelyhood that with the money situation banks are going to need to borrow loads of money to fund a growing economy.

Perhaps i should be more in economics.

Priapus

Joey the lips wrote: »

What would your opinion be

Stay variable and risk the rises

Go fixed for 3 years and sleep easier with less money...

Advice appreciated.

Joey the lips wrote: »

Thats not really the advice I am looking for. Thats just common sense.

Ehhh well your welcome!

Opinion asked - opinion given.

The just common sense answer is about the best anyone can do to such a general question

K_P

Hi OP,

I'm in the very same boat as yourself. Just came off a 3 year fixed rate at 4.75% and have been offered the same rates as yourself. Myself and the OH have decided to stay with the SVR for now. Yes, interest rates have nowhere to go but up, but it could easily be a year or so before that happens. Of course it could be sooner than that, but it's a chance we're willing to take.

We were happy to be on a fixed rate as it gave some stability during those expensive first few years of our mortgage, but for now I reckon SVR is the way to go.

raido9

Is switching banks an option. I know AIB are offering a fixed rate of 3.57 for 4 years at the moment. Their 3 year fixed is less again.

Do your maths, and your research, it might be worth making the switch.

jimoc

If you are looking to save money in the short term then go variable.
If however you like to know exactly what is going out every month then I would re-fix it again.

I like the security of knowing that exactly X euro is coming out of my account each month regardless of what happens so I'm always going to take fixed options.

Unless I can find a bank dumb enough to give me a tracker at .5% above ECB

alexmcred

Just to ask my own question rather than start a new thread I have a tracker at ECB +1.5% would I be mad to come off it and go back onto a fixed rate?

jimoc

alexmcred wrote: »

Just to ask my own question rather than start a new thread I have a tracker at ECB +1.5% would I be mad to come off it and go back onto a fixed rate?

Slightly mad yes, all the banks are trying to get people off trackers because they are losing money on them.

Guell72

Bank the difference between the Variable and the fixed rates.
If the rate goes above the fixed rate then use the savings you banked to make up the difference.