Five year fixes look good

by Ed Bowsher on 21 April 2010  |  0 comments
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Rates for five year fixed-rate mortgages have come down, so now could be a good time to go for a longer fix.

Mortgage guru Ray Boulger has published an interesting post today.

He points out that rates on the best five-year fixed rate mortgage deals have fallen back to where they were a year ago. So now might be a good time for a longer fixed deal as interest rates will probably rise over the medium term. Boulger is much less keen on 2-year fixed deals:

"A 2 year fixed rate on the other hand in many respects offers the worst of all worlds. If bank rate stays low for at least 2 years a tracker will work out cheaper and if interest rates rise one may pay a little less over the two years but will then probably only be able to get another fixed rate at a significantly higher level in 2 years time."

I think he's right. Some 5-year fixes do look attractive at the moment and I see little point in signing up for a fixed rate 2-year deal.

If you're thinking about getting a mortgage, you can get free advice from a broker at lovemoney.com mortgages.