is now the best time to fix?

[corcoran1]

Hi,

Im taking out a mortgage now and was ready to go on a variable rate. But alot of people are saying to fix now as rates are going to keep rising. According to director of the Irish Mortgage Corporation Frank Conway. Mr Conway said anyone who could get a fixed rate of 4pc or less should grab it now and fix. Is this good advice

 

[fizzelina]

we just got a mortgage recently and on the advice of our broker fixed for 2 years at 2.95%

 

[fto]

depends on your status, it is unlikely that the base rate will move above 2% in the next 12 months. The normally percentage the bank will add is around 2/3% above base rate for variable rates.

IF you are in a position that you can pay 5% in 2 years time it would be worth going on the variable rate and fixing it when interest rates increase.

However you can fix for 5 years at around 4.5% which gives you piece of mind, knowing what your repayments will be and when the interest rates do increase in a couple of years time you will be onside (have a better rate than current market rate)

so in conclusion

if you want secuirty fix a rate for as long as possible at a rate you can afford, ideally under 5% for 5 years, as current expectation is that interest rates will increase over the next few years as the economy recovers.

if you are happy to take a risk that they wont increase quickly to make short term gains don't fix. when i say short term i mean around 12 months.