Should I Fix My Mortgage Rate for 10 years?
With the recent increase in interest rates, this could see the end of the record low mortgage rates, so is now the right time for you to consider fixing your mortgage rate for 10 years?
This may feel daunting as many of us are used to fixing for 2 or a maximum 5 years. However, over the past 12 months the availability of longer term fixed rate mortgage deals has increased significantly. Alongside this, the interest rates on these longer-term loans have also decreased, making these an attractive option for many borrowers.
There are a number of things to consider when thinking about a 10-year fixed mortgage:
Will you want to move within 10 years?
If so, this may not be the best option for you as many of these mortgage deals will have a redemption penalty to pay should you wish to change your mortgage within this time.
Do you have a large deposit?
With many of the 10 year fixed rate mortgage options you'll need to have a deposit of at least 40% of the property value. If you have a lower deposit, there are other mortgage options available to you.
Fixed Mortgages have several benefits including:
- Fixing for a longer period time means that your repayments will remain the same which makes budgeting easier and offers more certainty to borrowers as they don’t need to worry about how they will be affected if interest rates increase.
- By opting for a fixed rate over a longer term you don’t have to search for a new mortgage every couple of years and pay the associated fees to change your mortgage.
Is This Right for You?
When considering your mortgage options, it is important to understand all the options available to you and your individual financial circumstances. As a mortgage broker we can look at your requirements and match you to the best possible mortgage product to suit you.
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