othing is ever certain in are set to rise in the near
the world of finances, and future, then taking a fixed rate
there’s no way of now could mean you will save
predicting how the market will money over the next few years.
change in the future. However, if Even if the Base Rate set by the
you want to be able to plan your Bank of England rises, you will
budget precisely, then a fixed be protected, at least for the
rate mortgage might be the right term that your payments are
option. The repayments will be fixed.
fixed for a set period of time –
usually between the first one and Fixed rate – the cons
five years of your mortgage, so
you can be sure that any rises in If the market changes and
the interest rate will not affect interest rates fall, you could
you. The term the rate remains lose out on a reduction in rates.
fixed can be as long as ten Fixed rate mortgages are often
years. set at slightly higher rates than
the cheapest deals. Be aware of
Fixed rate – the pros redemption penalties and clauses
that tie you to your mortgage –
For those on a tight budget, it these can last much longer than
can be useful to know exactly the fixed rate period and you may
what will need to be set aside find it prohibitively expensive
each month for mortgage if you want to change lenders or
repayments. Also, it can be a pay off your mortgage.
good move to fix your rate when
the economy looks like it’s about Thousands of people spend a lot
to change and interest rates of time studying the economy, and
rise. If, from studying the even the financial experts who
market, you anticipate that rates predict market conditions often
get it wrong. It’s impossible to
foresee how interest rates will You should also check to see if
change – although you may be able the fixed rate mortgage is
to apply common sense to a portable – this means that if you
certain degree, there is no want to sell up and move house
guarantee that a fixed rate during the tie-in period, you can
mortgage will beat the SVR five transfer the mortgage to your new
years down the line. Ultimately, property without incurring any
you have to make the best penalties.
decision you can based on the
situation as it stands.
About the Author:
Joe Kenny writes for the UK Loans Store where you will find information and reviews of the latest loans and offer more information on secured loans and other loan topics available on site. Visit Today: http://www.ukpersonalloanstore.co.uk
Read more articles by:
Joseph Kenny
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