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Mortgage Question (Halifax) - Five Year Fixed

ForeverAddicktedForeverAddickted
in Not Sports Related
As the title says... Have a five year fixed rate with Halifax that comes to an end around this time next year.

Had a letter from them today, they're going to start doing an extra check on Mortgages each year - To make sure that the Monthly Payments are on track

Letter says they'll do this even if you have Fixed Interest rate

It does go on to say that the Annual Statement will state if your Payment can change, and there is a "Things you need to Know" section in the letter which helps

"Some" reasons that can cause a Monthly Payment to Change are as follows, neither of which apply for me:
  • OverPayments (can see Payments go down)
  • Fees or Charges added (Payments could go up)
I know in Mobile Phone Contracts, you get warned that Bills will adjust according to inflation, usually a percentage.

But always presumed that a Fixed Mortgage, was a set Payment for however many years that the agreed rate was for, and then at the end of it, it becomes a variable one

Or am I being an idiot and worrying about nothing here?

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    ForeverAddicktedForeverAddickted
    golfaddick said:
    ForeverAddickted said:
    As the title says... Have a five year fixed rate with Halifax that comes to an end around this time next year.

    Had a letter from them today, they're going to start doing an extra check on Mortgages each year - To make sure that the Monthly Payments are on track

    Letter says they'll do this even if you have Fixed Interest rate

    It does go on to say that the Annual Statement will state if your Payment can change, and there is a "Things you need to Know" section in the letter which helps

    "Some" reasons that can cause a Monthly Payment to Change are as follows, neither of which apply for me:
    • OverPayments (can see Payments go down)
    • Fees or Charges added (Payments could go up)
    I know in Mobile Phone Contracts, you get warned that Bills will adjust according to inflation, usually a percentage.

    But always presumed that a Fixed Mortgage, was a set Payment for however many years that the agreed rate was for, and then at the end of it, it becomes a variable one

    Or am I being an idiot and worrying about nothing here?
    Worrying about nothing. 

    I assume it's due to the new Consumer Duty regulations which are basically more paperwork & no substance. 

    Everyone will get a statement even if nothing has changed. Just more bureaucratic nonsense dreamt up by someone to keep themselves in a job.


    Cheers Golfie... Presumed as much
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    sirjohnhumphreysirjohnhumphrey
    edited August 2023
    My current two year fixed rate is due to finish at the end of January 2024. I can now tie in a new rate from that date. Is going to be a pretty big hike. Is it worth committing to a new rate now or bide my time to see if the interest rates fall between now and January?
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    guinnessaddickguinnessaddick
    edited August 2023
    Don’t think rates will be coming down before that date. More a case of how many more rate rises will there be before that.
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    redmanredman
    sirjohnhumphrey said:
    My current two year fixed rate is due to finish at the end of January 2024. I can now tie in a new rate from that date. Is going to be a pretty big hike. Is it worth committing to a new rate now or bide my time to see if the interest rates fall between now and January?
    If you're saying tie in from new rate as from now, I can't see why you would. Also stops you shopping around seeing what's on offer.
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    McBobbinMcBobbin
    sirjohnhumphrey said:
    My current two year fixed rate is due to finish at the end of January 2024. I can now tie in a new rate from that date. Is going to be a pretty big hike. Is it worth committing to a new rate now or bide my time to see if the interest rates fall between now and January?
    My mortgage advisor was able to reserve the rate, but then if it dropped before the deadline was able to take that, so maybe you can do the same. Was with nationwide in case that makes a difference
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    SotonAddickSotonAddick
    McBobbin said:
    sirjohnhumphrey said:
    My current two year fixed rate is due to finish at the end of January 2024. I can now tie in a new rate from that date. Is going to be a pretty big hike. Is it worth committing to a new rate now or bide my time to see if the interest rates fall between now and January?
    My mortgage advisor was able to reserve the rate, but then if it dropped before the deadline was able to take that, so maybe you can do the same. Was with nationwide in case that makes a difference
    I've done similar with Natwest. Current deal expires at end of December so secured a deal on their best available rate at the time, but if the rates drops before the new deal starts I can switch to the cheaper deal. 
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    sirjohnhumphreysirjohnhumphrey
    SotonAddick said:
    McBobbin said:
    sirjohnhumphrey said:
    My current two year fixed rate is due to finish at the end of January 2024. I can now tie in a new rate from that date. Is going to be a pretty big hike. Is it worth committing to a new rate now or bide my time to see if the interest rates fall between now and January?
    My mortgage advisor was able to reserve the rate, but then if it dropped before the deadline was able to take that, so maybe you can do the same. Was with nationwide in case that makes a difference
    I've done similar with Natwest. Current deal expires at end of December so secured a deal on their best available rate at the time, but if the rates drops before the new deal starts I can switch to the cheaper deal. 
    I’ve done two year fixed deals historically. Is it worth opting for a five year fixed this time?
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    Covered_End_LadCovered_End_Lad
    sirjohnhumphrey said:
    SotonAddick said:
    McBobbin said:
    sirjohnhumphrey said:
    My current two year fixed rate is due to finish at the end of January 2024. I can now tie in a new rate from that date. Is going to be a pretty big hike. Is it worth committing to a new rate now or bide my time to see if the interest rates fall between now and January?
    My mortgage advisor was able to reserve the rate, but then if it dropped before the deadline was able to take that, so maybe you can do the same. Was with nationwide in case that makes a difference
    I've done similar with Natwest. Current deal expires at end of December so secured a deal on their best available rate at the time, but if the rates drops before the new deal starts I can switch to the cheaper deal. 
    I’ve done two year fixed deals historically. Is it worth opting for a five year fixed this time?
    I personally would stay with a shorter term fixed rate, at some point in the next year or two the rates should drop down again significantly
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    HuskarisHuskaris
    I would be looking at a 2 year if I had to fix now (maybe a 3), a 5 year if you asked me a year ago, which I did myself at 3%.

    Rates (in my opinion) are going to be roughly where they are for the next 1.5-2 years, although I also think inflation targets for western developed nations will be more like 3-4% rather than 2% in the next economic cycle. 
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    Captain_BirdseyeCaptain_Birdseye
    You should be fine to go for a deal now and switch if something better comes along. We had a new deal kick in in July. We signed up to a deal in Feb then were able to switch when a better deal came along in Apr. Both were NatWest and we used a mortgage broker.
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    golfaddickgolfaddick
    redman said:
    sirjohnhumphrey said:
    My current two year fixed rate is due to finish at the end of January 2024. I can now tie in a new rate from that date. Is going to be a pretty big hike. Is it worth committing to a new rate now or bide my time to see if the interest rates fall between now and January?
    If you're saying tie in from new rate as from now, I can't see why you would. Also stops you shopping around seeing what's on offer.
    Completely the opposite is true. As someone then posted, you can "secure" a rate now (which usually holds for 6 months) and if rates fall inbetween times you can discard that deal & take up another. That could be with the same lender (by just re-applying again) or by remortgaging to another lender. 

    Thing is, no one knows what is going to happen over the next 4-6 months. Perceived wisdom a few months ago was that interest rates would peak at 5% & start falling by the end of the year. Now the BOE are saying that rates might have to go up again & stay at that rate well into 2024. No one really knows. 

    Also quite a few commentators are saying the BOE are wrong with their strategy and rates should be starting to be cut asap. 

    5 years is a long time & rates could be back below 3% within the next 3 years or so. Being tied into 6% in 3 years time when rates are half that could be very hard to swallow for some people. 

    A 3 year rate maybe the way to go.
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    Cafc43v3rCafc43v3r
    If rates are falling in the months before you have to renew it might even be worth 2 or 3 months on a variable to secure a better fixed rate.

    I expect intrest rates to peek this autumn and start falling early next year, but 3-4% will be the new medium term "normal" not 2 and under like we have seen for the last 15 odd years.  Unfortunately.
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    PrincessFionaPrincessFiona
    Cafc43v3r said:
    If rates are falling in the months before you have to renew it might even be worth 2 or 3 months on a variable to secure a better fixed rate.

    I expect intrest rates to peek this autumn and start falling early next year, but 3-4% will be the new medium term "normal" not 2 and under like we have seen for the last 15 odd years.  Unfortunately.
    The low interest rates for so long was very unusual. I think some people mistakenly thought it was the norm and wouldn't change
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    Cafc43v3rCafc43v3r
    PrincessFiona said:
    Cafc43v3r said:
    If rates are falling in the months before you have to renew it might even be worth 2 or 3 months on a variable to secure a better fixed rate.

    I expect intrest rates to peek this autumn and start falling early next year, but 3-4% will be the new medium term "normal" not 2 and under like we have seen for the last 15 odd years.  Unfortunately.
    The low interest rates for so long was very unusual. I think some people mistakenly thought it was the norm and wouldn't change
    Yup but it is still likely to go down, over the next 18 months.
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    superclive98superclive98
    Cafc43v3r said:
    PrincessFiona said:
    Cafc43v3r said:
    If rates are falling in the months before you have to renew it might even be worth 2 or 3 months on a variable to secure a better fixed rate.

    I expect intrest rates to peek this autumn and start falling early next year, but 3-4% will be the new medium term "normal" not 2 and under like we have seen for the last 15 odd years.  Unfortunately.
    The low interest rates for so long was very unusual. I think some people mistakenly thought it was the norm and wouldn't change
    Yup but it is still likely to go down, over the next 18 months.
    But not, if ever, to 0.25% and certainly not for the length of time previously enjoyed by borrowers.
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    golfaddickgolfaddick
    Cafc43v3r said:
    If rates are falling in the months before you have to renew it might even be worth 2 or 3 months on a variable to secure a better fixed rate.

    I expect intrest rates to peek this autumn and start falling early next year, but 3-4% will be the new medium term "normal" not 2 and under like we have seen for the last 15 odd years.  Unfortunately.
    A few months ago the Governor of the BOE said that the Bamk's aim was for rates to be back close to the recent lows - max 2% (as long as inflation was under control). 

    However, a report out this weekend suggests the BOE forecasts have been wrong since the pandemic & have over estimated where inflation would be 6-9 months hence. 
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    se9addickse9addick
    AFKABartram said:
    You could always take the talal approach and just pay it all off now to save on your monthly budget for the next 25 years… :-) 
    Different budgets. 
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