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fixing mortgage

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  • 26-04-2007 8:43pm
    #1
    Eoghan25
    Registered Users Posts: 121 ✭✭


    what do people think of fixing mortgages given the current marketing conditions.. i have been offered a switch mortgage on the condition i fix it for 3 years it seem a very long time if my understanding is right within that period if i decide to trade up this would be considered a breach of agreement and i am open to penalties. I understand that the interest are climbing but is it really worth commiting for 3 years?


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    #2
    The_Conductor
    Moderators, Society & Culture Moderators Posts: 32,279 Mod ✭✭✭✭The_Conductor


    Eoghan25 wrote:
    what do people think of fixing mortgages given the current marketing conditions.. i have been offered a switch mortgage on the condition i fix it for 3 years it seem a very long time if my understanding is right within that period if i decide to trade up this would be considered a breach of agreement and i am open to penalties. I understand that the interest are climbing but is it really worth commiting for 3 years?

    Factor in worse case scenarios. What would happen if interest rates went up 1% or more above their current levels. Would you be able to absorb the additional cost, or would it impose an unacceptable financial burden on you. If you could not pay a 1% rise (Consumers advocates advise factoring a 2% rise in, but its highly unlikely in a Eurozone context) then you should fix at the best possible rate you can get. There are 3 year fixed at below 5% out there- they look like good value......

    A lot of financial institutions will be withdrawing their current 3 and 5 year offers over the next couple of weeks to factor in the likely rise here in June (and possibly as early as next month).

    Its an insurance policy- you pay a little for the sake of the peace of mind of knowing that if the worse comes to the worse you are covered- when you fix your rates.

    Do shop around though- the offers from the different institutions on 3 and 5 year products varies considerably.


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    #3
    K_P
    Registered Users Posts: 577 ✭✭✭K_P


    I fixed my mortgage a few months ago and the peace of mind is great. Having said that, if you're considering moving in the next few years, it probably isn't worth it. Maybe you could look into fixing for a year?


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