The 'Fixed Rate' Mortgage

Unlike tracker mortgage customers, who have felt the full benefit of a plummeting interest rate and a cut in their monthly repayments, those with a fixed rate mortgage have had things a little more difficult recently. Because fixed rate mortgages are exactly what they say they are – fixed rate – those customers have seen their rates stay well above the nose-diving Bank of England base rate. But as people come to the end of their current mortgage special deals, is now the time to take out another fixed rate mortgage?

The simple answer is ‘yes’. Basic economics will tell you that the only way the base interest rate can go from here is up. As interest rates go up, those with tracker mortgages will see their monthly repayments increase whereas those taking out a fixed rate mortgage now will benefit from an all-time low interest rate that will remain static as the base rate starts to climb. Having a fixed rate mortgage means that you know exactly how much will be coming out of your bank account every month. And with the economic picture still somewhat ‘fluid’ to say the least, having one certainty, especially if it’s at a rate that means your payments are manageable, is an enviable position to be in.

Knowing exactly how much is going to be paid out in fixed rate mortgage repayments every month means that you can plan your finances carefully. It also means you can take full advantage of the fixed rate mortgage deals that are around at the moment and have a mortgage that stays at the same low rate while tracker mortgages start to go up. You can be relatively confident of keeping the roof over your head for the foreseeable future.

Taking out a fixed rate mortgage is probably the best option to choose in the current economic climate. If you would like further details on how to take advantage of this situation, contact us now and we’ll talk you through the advantages of a fixed rate mortgage.