4.95% fixed for 5 yrs with UB

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shootingstar

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i was refused a remortgage with UB, had a bit of an arguement with their mortgage rep etc. he said he`d try and help me as regards my mortgage rates etc. Got letter this morning offering me the following:

4.65% - fixed for 2 or 3 yrs.
4.95% - fixed for 5yrs.

Im currently on 4.65% ECB..

can i get some opinions on this please before i sign the form.
 
after i posted this i knew i had something wrong... :eek:

i dont understand the whole ECB / Tracker / rates a whole lot. i was told im on the European Central Bank tracker rate. Mortgage guy said i was currently on 4.65% ???

i get notification of increases and such from UB but (you may gasp) i never read them. :eek:

u think 4.95 for 5 yrs fixed is worth looking at?
 
shootingstar said:
i dont understand the whole ECB / Tracker / rates a whole lot. i was told im on the European Central Bank tracker rate. Mortgage guy said i was currently on 4.65% ???
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It's very simple if it's a tracker mortgage. Basically your mortgage rate will be ECB + x% so that the rate changes as the ECB rate changes and x is the fixed margin over the ECB base rate that the lender charges. If you are paying 4.65% then you are either on ECB + 0.65% (ECB rate became 4% the other day) or - more likely I think - ECB + 0.9% based on the ECB rate of 3.75% up to last Wednesday (?).
u think 4.95 for 5 yrs fixed is worth looking at?
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Depends - if you are struggling with the repayments or might if rates keep increasing then perhaps. If not then you might be better off sticking with the best value tracker rate on offer for your circumstances. Nobody can predict the future but it's usually not a great idea to go fixed in an attempt to time the market, second guess the financial institutions and save money versus a competitive tracker rate.
 
Thanks - I thought I saw you mentioning that elsewhere alright. So it's virtually certain that if the original poster is on a tracker rate of 4.65% then their rate is actually determined by ECB + 0.9%.
 
ClubMan said:
Depends - if you are struggling with the repayments or might if rates keep increasing then perhaps. .
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this is the case yes. what im paying out now is fine and possibly a little more would be fine too but if it continues to hike up then im in trouble. I pay this (like a rope around my neck) mortgage myself so it can be difficult from time to time.
4.95% would be ok to pay back. i have my mortgage 3 years and interest rates just keep going on and on........
 
Bear in mind that fixing for a long time (e.g. 5 years) could also be a double edged sword - e.g. if rates happen to fall over that time and/or if you decide that you want to remortgage, move, switch lenders etc. - in which case you will face fixed rate breakage penalties. Have you checked the fixed rates on offer from other lenders while you're at it?
 
So it's virtually certain that if the original poster is on a tracker rate of 4.65% then their rate is actually determined by ECB + 0.9%.
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Yes. Further, I expect some ECB tracker products wait a few weeks to react to ECB changes (depends on the terms and conditions.).
 
no i didnt check them simply because i couldnt go through the whole rig-ma-role of remortgaging again. ya i know time and effort may pay off...
 
Personally I would be very reluctant to fix for a period of 5 years but it really depends on specific circumstances and medium term plans etc. Nobody can really make the decision for you but at least some of the pros/cons are outlined here and in the many other threads on the whole fixed versus variable/tracker issue.
 
shootingstar said:
tracker products?
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Such as ...

Mortgages where the rates charged are determined with respect to ECB + some margin as explained above.

Also deposit products where the rates paid out are set with respect to ECB + some margin.
 
thank you.
i have learnt more today about this than i have in the past 3 yrs... :eek:
i have no intention of selling or moving in the next 5 years. cant afford it anyway even if i wanted to... will have a serious think about the 5 yrs fxd.
 
u can never know with the interest rates but it looks like it will peak at 4.25 ECB and from there on it might be flat for a while. if you take NIB product of ECB+0.5, you need two more ECB rate increases to reach 4.95, would you not consider switching
 
dublinli said:
u can never know with the interest rates
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Indeed.
but it looks like it will peak at 4.25 ECB and from there on it might be flat for a while.
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Why does it look like this? I've heard other "experts" say that they expect them to go to 5% within 12 months.
if you take NIB product of ECB+0.5, you need two more ECB rate increases to reach 4.95, would you not consider switching
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Ultimately nobody can predict the future so don't bother fixing in an attempt to time the markets, second guess the institutions and save money versus a competitive tracker/variable rate. If you need (e.g. due to cashflow constraints) to fix then do so. If you don't then don't.
 
i think i read along the way that theres another 2 more hikes in the interest rates this year coming up?

i dont think rates are going to drop.. then again... my mortgages certainly hasnt dropped in the last 3 yrs.
for security reasons i`d prefer to know what my outgoings are each month. also financially i have to account for each penny. think im going to take the 5 yrs. it may well give me peace of mind.
 
ClubMan said:
Indeed.

Why does it look like this? I've heard other "experts" say that they expect them to go to 5% within 12 months.

today's eu data show that industrial porduction down by 0.8 per cent in april, expectation was for it to be up by 0.2 per cent. in germany they are revising economic growth rate figures for the second quarter, it is downwards though. the data do not show a trend yet, we will see over the summer.

Ultimately nobody can predict the future so don't bother fixing in an attempt to time the markets, second guess the institutions and save money versus a competitive tracker/variable rate. If you need (e.g. due to cashflow constraints) to fix then do so. If you don't then don't.
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this is exactly my point as well, do not try to fix as long as you can afford the payments. most of the time you will not be able to beat the banks. hence the example from nib tracker mortgage
 
Why does it look like this? I've heard other "experts" say that they expect them to go to 5% within 12 months.


today's eu data show that industrial porduction down by 0.8 per cent in april, expectation was for it to be up by 0.2 per cent. in germany they are revising economic growth rate figures for the second quarter, it is downwards though. the data do not show a trend yet, we will see over the summer.
 
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