Fixing to 5.75% :(

elchanco

Long story short... owe 270k, currently on svr of 4.65% with PTSB. Afraid of the coming interest raises and considering fixing. Choice: 2yrs 5.2% and 5yrs 5.75%.

Shocking rates but cant change banks, probably 60k in negative equity!
Opinions please, need to decide this week to avoid going loco thinking about it!

dotsman

elchanco wrote: »

Long story short... owe 270k, currently on svr of 4.65% with PTSB. Afraid of the coming interest raises and considering fixing. Choice: 2yrs 5.2% and 5yrs 5.75%.

Shocking rates but cant change banks, probably 60k in negative equity!
Opinions please, need to decide this week to avoid going loco thinking about it!

Given the ridiculously high rate you are on at the moment, and given that you can't change bank, my advice would be is - if you can afford it, do fix at the 5.75. It's not much more than you are already paying and gives you the peace of mind for the next 5 years (hopefully by then you will out of negative equity and able to switch to a far more competitive bank.

The other route is to fix part of your mortgage (which I have done). Doesn't cost as much for the moment, and offers a cushion against future increases.

Please be aware that fixing is just that - everything is fixed. You pay penalties during the fixed period should you choose to underpay, overpay, or change mortgage rate/bank.

elchanco

5.75% is stetching my budget big time,and the thoughts of paying that rate for 5years is killing me but i have no choice...

I can see the svr with PTSB going up to 6/7% in two years (1% increase by the bank & at least 1% by the ecb).

How does "jingle mail" work lol...

kaiser sauze

dotsman wrote: »

Please be aware that fixing is just that - everything is fixed. You pay penalties during the fixed period should you choose to underpay, overpay, or change mortgage rate/bank.

This is not always true.

broker2008

Funny when I saw the thread title, it made me look again and I did think it was shocking. Damned if you do, damned if you don't I guess. Good luck with your choice.

dotsman

kaiser sauze wrote: »

This is not always true.

When is it not true? (Besides when the SVR exceeds the fixed rate, in which case, a person is hardly likely to want out of the Fixed rate!)

kaiser sauze

dotsman wrote: »

When is it not true? (Besides when the SVR exceeds the fixed rate, in which case, a person is hardly likely to want out of the Fixed rate!)

Erm, when the T&Cs actually allow for changes to be made.

Simples.

dotsman

kaiser sauze wrote: »

Erm, when the T&Cs actually allow for changes to be made.

Simples.

Um, that's not standard. I'm not aware of any Fixed rate that allows you to break without paying a penalty. It kind of defeats the purpose of a fixed rate. Can you link to an example?

kaiser sauze

dotsman wrote: »

Um, that's not standard. I'm not aware of any Fixed rate that allows you to break without paying a penalty. It kind of defeats the purpose of a fixed rate. Can you link to an example?

Yes, it is not standard, or more accurately: common.

However, your statement that all fixed rates are, for example, agreements that could not be repaid early without charges is incorrect. I was merely correcting that.

dotsman

kaiser sauze wrote: »

Yes, it is not standard, or more accurately: common.

However, your statement that all fixed rates are, for example, agreements that could not be repaid early without charges is incorrect. I was merely correcting that.

Can you link to an example? As I said, I have never seen one, nor can I imagine how one would work, yet still be regarded as "fixed", as it defeats the purpose of being fixed. The warning I offered the OP is of the same kind that is required by regulations when talking about fixed rate products, and for good reason.

kaiser sauze

dotsman wrote: »

Can you link to an example? As I said, I have never seen one, nor can I imagine how one would work, yet still be regarded as "fixed", as it defeats the purpose of being fixed. The warning I offered the OP is of the same kind that is required by regulations when talking about fixed rate products, and for good reason.

The operative words are the ones highlighted.

I have. We are diverting the topic here.

parsi

Please tell us more. I'd be interested in that. Maybe what we've all thought of as being irrevocably fixed isn't.

dotsman

kaiser sauze wrote: »

The operative words are the ones highlighted.

I have. We are diverting the topic here.

I don't think we are diverting the topic at all. I gave the op legitimate advise. You have accused me of being wrong, yet fail to provide any evidence. Please, either show us all what fixed rate products aren't "fixed" or stop trolling.

elchanco

looks like a started a debate!

Im going to ring the bank tomorrow to fix.. have no choice really!

I was on fixed in 2007 & enquired about changing rate,there was a BIG penalty yo do this.

kaiser sauze

dotsman wrote: »

I don't think we are diverting the topic at all. I gave the op legitimate advise. You have accused me of being wrong, yet fail to provide any evidence. Please, either show us all what fixed rate products aren't "fixed" or stop trolling.

No, what you are doing is getting a bit sore and uppity because I corrected a small part of what you said. A statement you claimed was definitive and absolute.

Not every fixed rate has zero flexibility as you infer, not every fixed rate has an early repayment penalty or get out charges.

kaiser sauze

elchanco wrote: »

looks like a started a debate!

Im going to ring the bank tomorrow to fix.. have no choice really!

I was on fixed in 2007 & enquired about changing rate,there was a BIG penalty yo do this.

It's a very high rate, but there are few options on the market now and you are likely stuck with the lender you have now, and the rates they offer, as banks are simply not lending, despite their public protestations.

I wish you all the best, just remember that your mortgage is your for your home and stressing over the equity, or not, is counterproductive. It's a long-term commitment and there are guaranteed to be more fluctuations in the market pace, up & down, before your term ends.

dotsman

kaiser sauze wrote: »

No, what you are doing is getting a bit sore and uppity because I corrected a small part of what you said. A statement you claimed was definitive and absolute.

Not every fixed rate has zero flexibility as you infer, not every fixed rate has an early repayment penalty or get out charges.

Please, please, please, point me in the direction of a fixed rate mortgage that is not "fixed", and allows people to vary the interest rate, repayments etc at their discretion. If you are going to accuse someone of being wrong, the decent thing is to provide an example or evidence etc. I fully admit to not having intimate knowledge of every single mortgage product provided in this country an if there is an exception to the rule, I would love to know more about it. Or perhaps you think it's best that people are advised to go for a fixed rate without being aware of the potential downsides.

elchanco

Rang the bank today and was advised that i had to pay 100e for the privilage of fixing.. a final kick in the balls!

Gotta love PTSB!