Mortgage Advice: Lender, Fixed or Variable

[ghg]

Hi there,

We are currently looking at different lenders with a view to getting a mortgage with a 20% deposit. We are using a broker and time and again KBC seems to be coming up as the lender offering the best rates. From reading on this website I see KBC being hammered for the difference in new vs existing customer rates. I also cant seem to find how long the new customer rate lasts for if you choose variable rate before you get moved onto their existing customer rate, does anyone know? BOI has the 2% deal which is attractive but again I read on here that their rates are the highest of the lenders.

The other question we have is whether to fix the rate or not. I see it mentioned on this forum recently (Sept 2015) that variable interest rates are too high still and so the advice seems to be not to fix as they should come down. Is this still the case? I've also been told from our broker that a good test to see whether to fix or not is to look to what the banks are charging for fixed vs variable, at the moment it appears that fixed rates are higher than variable, so if you follow that logic it would suggest the banks think rates will rise in the next few years.

To summarise, the 2 main questions I have are:
-Which lender should we go for?
-Should we fix?

Vital stats:
Mortgage amt: 216,000
Deposit: 54,000
House Price: 270,000

Any advice appreciated.

Thanks

 

[so-crates]

As a fixed rate mortgage is a premium product from the banks perspective (they are taking the risk of rate increases), as a general rule the rate quoted will be higher than the prevailing variable rate. It doesn't automatically mean their crystal ball is blinking rate increase, it simply means you are paying for the privilege of knowing what rate you will be charged for the period.

 

[pauric]

Also, in the same situation as you. I keep looking at UB fixed rate of 3.7% for 7 years and wonder would it be worth it. On the other hand there fixed rate of 3.2% for years is very attractive looking. I've found that UB have the best rates across the board when I last looked back in December, have KBC changed since?

 

[ghg]

As far as I know the UB rate only applies to higher amounts than what I am looking to borrow?