I'm being offered a fixed term mortgage as an existing customer of Lloyds at
4.79% which is fairly competitive and I don't want the hassle of swithching lenders. I'm unlikely to want to sell the property in the near future and so i'm considering whether to commit to this rate for 2, 3 or 5 years, all of which are on offer. What would you do under the circumstances? I realise no-one has a crystal ball as far as future interest rates are concerned but i'd be interested to hear what you think.xiv
what do you get in exchange for the longer commitment ? If nothing then just go for the shorter period and keep your options open.
"Zoe Brown" wrote
But those options, in two or three years' time, might not include a rate as low as 4.79% ! If so, he might've been better off "locking-in" to the lower rate for the longer term...
Yup, Zoe and Tim, there's the conundrum...
So the question remains, what should I do? Any analysts out there care to make a prediction?
If I was in your position I would probably take it. Sure, rates might come down a bit, but they are already at an historical low. Not many people can predict what rates will be in 6 months, let alone a few years. I would err on the safe side.
Like we say in French: "Un tiens vaut mieux que deux tu l'auras"
In message , louis xiv writes
How much lower can rates go? The base has been 3.75% - it was part of the reason for a sizeable boom - will they go that low again in 4/5 years? Maybe, maybe not. Even if they do, you will be paying 1% over base - not a bad rate.
If we were to join the euro, rates would match European rates, around 2% base at present IIRC - will we join the euro? Nobody is shouting about it at the moment, but we might.
How much higher can rates go? In the short term, they seem pretty stable
- but there is much more room for them to rise than there is for them to fall.
If my bank offered me 4.79%, I would snap their hands off for 3 years, and probably for 5 years.
Not advice, but you will get my drift.
May wee, a lore: "A beurde in ze end is veurce tou in ze bouche".
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