Should I fix for 3 years or 5 years?

tigger123

Hi all, some advice needed.

We've been offered a 3 year and 5 year fixed from our bank, both at 3%. This rate would reduce our monthly payment by approx 40 euro (better in our pocket than theirs).

But what I'm wondering is whether its a good idea to fix for 5 years? Or will this current situation pass relatively quickly?

Please polish your crystal balls...

accensi0n

5 years.

ongarite

Fix for 5 years.

ECB base rates will never be a low as they have been for last few years, virtually negative interest rates. Only going to increase to 2% by end 2023.

3% fixed is poor rate IMO.

StevenToast

As long as you have no intention on selling the house in the next 5 years....

Fix for 5 years

tigger123

https://www.boards.ie/discussion/comment/119371330#Comment_119371330

Why does the house sale within 5 years come into it? Because of the breakage fee?

(Yes I can hear you Clem Fandango!)

The Mulk

I'm fixing mine for 20 years at 2.5%. We've just gone onto variable at the moment, knocks 5 years of the term with the same payments and can over pay by 10% every year

StevenToast

Exactly......if you sell within that timeframe you will be stung with a hefty enough penalty (depending on how long is left in the fixed term)...

Interest rates are only going one way for the next few years...

paulieeye

Worth noting that with Avant if you move house and take your next mortgage out with them then there is no break fee on the initial mortgage.

I'm looking at fixing for 10 years.

OP, you might be able to do better than 3% if you look elsewhere. Is there a cashback to make the 3% a bit sweeter?

Fawk Nin

https://www.boards.ie/discussion/comment/119371354#Comment_119371354

Avant?

The Mulk

https://www.boards.ie/discussion/comment/119371549#Comment_119371549

That's it, we traded up about 5 years ago so plan to stay here, hopefully.

tigger123

https://www.boards.ie/discussion/comment/119371542#Comment_119371542

Yep, there is a cashback.

I tried ringing BOI to discuss the breakage fee on our current fixed rate. They're a complete nightmare to deal with sometimes.