Mortage on base rate - what to do when rates rise?
Discussion
We are lucky enough to have the mortgage on a base rate at the moment, but with a lot of talk at the moment about the 'inevitable' raise in interest rates is there a suggested plan of action?
Should we stick it out on base rate as I assume the rate will still be lower than any deals that are going around at the moment? Or should we look to lock it down for the longest time possible as at some point the base rate (plus 2%) will go past the rates they currently offering?
Should we stick it out on base rate as I assume the rate will still be lower than any deals that are going around at the moment? Or should we look to lock it down for the longest time possible as at some point the base rate (plus 2%) will go past the rates they currently offering?
It's anyone's guess what will happen and when. They can only go one way - the only issue is when.
It's probably not a very helpful answer but ask yourself how much you value the certainty of knowing what you will pay every month. If it's important, fix now (even if it means paying more than sitting on a base rate tracker for a while longer) and lock in before rates go up.
If you can afford to pay more if need be, sit tight and gamble that the BoE can't afford to raise rates for another 9-12 months for fear of killing off the fragile economic recovery from recession.
Only you can answer that.
There doesn't seem to be any real concensus among those supposedly "in the know" as to what is going to happen, so what chance that the PH massive will be able to do any better....?
(FWIW, I've got a chunk of my mortgage, about half from memory, on a base rate +2% SVR. The other chunk is fixed at around 5.5% for the next couple of years. I'm in no hurry to lock the floating chunk back into a fixed rate and will just overpay in the meantime to the tune of what I was paying before it came off fix)
It's probably not a very helpful answer but ask yourself how much you value the certainty of knowing what you will pay every month. If it's important, fix now (even if it means paying more than sitting on a base rate tracker for a while longer) and lock in before rates go up.
If you can afford to pay more if need be, sit tight and gamble that the BoE can't afford to raise rates for another 9-12 months for fear of killing off the fragile economic recovery from recession.
Only you can answer that.
There doesn't seem to be any real concensus among those supposedly "in the know" as to what is going to happen, so what chance that the PH massive will be able to do any better....?
(FWIW, I've got a chunk of my mortgage, about half from memory, on a base rate +2% SVR. The other chunk is fixed at around 5.5% for the next couple of years. I'm in no hurry to lock the floating chunk back into a fixed rate and will just overpay in the meantime to the tune of what I was paying before it came off fix)
JPJPJP said:
If you have base rate + 0% then stay with it
The gap between base and the offers of most institutions is still quite significant and it will be a long time (imo) until there are (m)any offers that work out at less than base
It's base rate plus 2% (Nationwide).The gap between base and the offers of most institutions is still quite significant and it will be a long time (imo) until there are (m)any offers that work out at less than base
Lurking Lawyer said:
It's anyone's guess what will happen and when. They can only go one way - the only issue is when.
It's probably not a very helpful answer but ask yourself how much you value the certainty of knowing what you will pay every month. If it's important, fix now (even if it means paying more than sitting on a base rate tracker for a while longer) and lock in before rates go up.
If you can afford to pay more if need be, sit tight and gamble that the BoE can't afford to raise rates for another 9-12 months for fear of killing off the fragile economic recovery from recession.
Only you can answer that.
There doesn't seem to be any real concensus among those supposedly "in the know" as to what is going to happen, so what chance that the PH massive will be able to do any better....?
(FWIW, I've got a chunk of my mortgage, about half from memory, on a base rate +2% SVR. The other chunk is fixed at around 5.5% for the next couple of years. I'm in no hurry to lock the floating chunk back into a fixed rate and will just overpay in the meantime to the tune of what I was paying before it came off fix)
I doubt the PH masses will know any better! I'm just looking for an alternate point of view from that of my own, which is currently set to undecided! It's probably not a very helpful answer but ask yourself how much you value the certainty of knowing what you will pay every month. If it's important, fix now (even if it means paying more than sitting on a base rate tracker for a while longer) and lock in before rates go up.
If you can afford to pay more if need be, sit tight and gamble that the BoE can't afford to raise rates for another 9-12 months for fear of killing off the fragile economic recovery from recession.
Only you can answer that.
There doesn't seem to be any real concensus among those supposedly "in the know" as to what is going to happen, so what chance that the PH massive will be able to do any better....?
(FWIW, I've got a chunk of my mortgage, about half from memory, on a base rate +2% SVR. The other chunk is fixed at around 5.5% for the next couple of years. I'm in no hurry to lock the floating chunk back into a fixed rate and will just overpay in the meantime to the tune of what I was paying before it came off fix)
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