Fixed rate on commercial loan ending - what to do?

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I have a commercial mortgage/loan on an investment property. I've been offered the following rates when my current fixed rate ends

Variable 2.3%
3 year fixed 3.88%
5 year fixed 4.4%

The banks margin on this is 1.6%. If interest rates go up .25 percent in 6 months or .5 % (interest rates are forecast to rise in 2010) what would I be better off doing?
 
Have you tried to negotiate the Bank's margin ?? Personally, I would leave it on the variable rate as I do not see any major increase in the short term rates over the next 18 months. As long as you are happy with the rent been paid to you this remain of utter importance.
 
I was told that it was a no go on the margin. Apparently I have a good rate but I have no idea what other's pay in relation to margin and commercial rates are not listed anywhere so how can I know.
 
Well in this market and without knowing the location and strength of the covenant, the margin of 1.6% is satisfactory. I've heard stories of quotes of 2.5% margins of good well tenanted Commercial properties. In reality it is down to a view on the Interest rates, coupled with the tenant paying his dues and complying with the terms of the Lease.
 
Mercman I think you think it's a commercial lease? It's just an investment property that's rented to regular tenant's. The bank doesn't know how much rent I receive or anything about leases etc.

When I got this 'mortgage' the bank said this was the easiest way to get the loan (they were throwing out money then, though I didn't realise to what extent) and it was a very simple process.

Anyone able to tell me how much interest rates have to rise before it makes sense to fix? Because the difference between 3 year fix and the variable is 3.88 to 2.3 there is a certain point when it becomes better to fix? How many months would that be?
 
Since that I've gone to the variable rate of 2.3% (a 3 year fix would now be 3.75% and a 5 year fix would be 4.35%). The rates are based on interbank rates rather than the ECB rates (though naturally if this goes up the interbank will too). My bank does not publish the interbank rates.

How can I see or watch interbank rates?
 
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