Remortaging buy-to-lets. 2 years or pay more for 5 years fix?

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Found 7th Mar
Any landlords on here? Are you going for the cheaper 2 year fix or paying more for security of 5 years? Opinions please!
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Be wary of arrangement fees.

I've always tried to fix for as long as possible if the rate is competitive. The more often you remortgage the more arrangement fees you will pay. Worth looking at each providers SVR so you know what it will default to once your 'deal' expires. I've been on my lenders SVR for about 6 years as I see no point in paying about £1k in fees to be tied into a higher rate.
Yes I`m factoring the product fee into the overall cost for Comparison. I got caught out last time just looking at interest rates. It often works out a lot cheaper to go for a slightly higher rate with no fee.
Just trying to decide whether it`s worth paying more every month as 5 year fixes are more expensive. It`s just a case of whether interest rates are going to go up or not, that`s the million dollar question!
What's the gap between the two rates you're comparing? Where do you think rates will be in 2yrs time compared to now?

It looks like at least one increase of 0.25% is inevitable this year, sooner rather than later based on what the BoE have been hinting at. As you say, it's the million dollar (or pound!) question.
Edited by: "morgie" 7th Mar
Your lucky your lenders SVR is low, most SVR`s now are 4-5% after a fix finishes so it`s still cheaper to swap to a new mortgage when your fix ends.
morgie8 m ago

What's the gap between the two rates you're comparing? Where do you think …What's the gap between the two rates you're comparing? Where do you think rates will be in 2yrs time compared to now?It looks like at least once increase of 0.25% is inevitable this year, sooner rather than later based on what the BoE have been hinting at. As you say, it's the million dollar (or pound!) question.


It`s 0.62% higher....will cost an extra £65 a month, so £1500 odd over 2 years. I don`t think they will go up as much as people think in the next 2 years. But then I`d be having to renew again in 2 years, with all the hassle & could be looking at product fees....
Two year rates are pretty low at the moment - hard to pass up, but you have to weigh up whether the rates will increase more than what the five yer rate is.
I fixed for 10 years, depends whether you think historical low rates will continue, my gamble is No.
cazsilver8 h, 9 m ago

It`s 0.62% higher....will cost an extra £65 a month, so £1500 odd over 2 y …It`s 0.62% higher....will cost an extra £65 a month, so £1500 odd over 2 years. I don`t think they will go up as much as people think in the next 2 years. But then I`d be having to renew again in 2 years, with all the hassle & could be looking at product fees....


Hmmm, so yeah an extra £1500 over 2 yrs. To remortgage in 2 yrs time even if you assume a fee then of say £500 and just one 0.25% rise in the mean time (probably quite a modest assumption, but who knows!/) then there's really not much in it to know you're locked in for another 3yrs at that rate. I guess it if you look at it this way you also have to assume rates for new products will be worse in 2yrs time. Just my thoughts - definitely not a financial adviser and not a landlord either, but do have a mortgage.

Other points to consider -

* What LTV are you at now? If you're not already at 60%, do you think you could be there in 2yrs time due to property price inceases and what you'll have paid off? If so, this could make the 2yr more favourable if you think you'll qualify for better rates in 2yrs time due to improved LTV.

* Not likely to need to end your tenancies/sell in the next X yrs (depending on which product you go for)?
Edited by: "morgie" 8th Mar
morgie40 m ago

Hmmm, so yeah an extra £1500 over 2 yrs. To remortgage in 2 yrs time even …Hmmm, so yeah an extra £1500 over 2 yrs. To remortgage in 2 yrs time even if you assume a fee then of say £500 and just one 0.25% rise in the mean time (probably quite a modest assumption, but who knows!/) then there's really not much in it to know you're locked in for another 3yrs at that rate. I guess it if you look at it this way you also have to assume rates for new products will be worse in 2yrs time. Just my thoughts - definitely not a financial adviser and not a landlord either, but do have a mortgage. Other points to consider - * What LTV are you at now? If you're not already at 60%, do you think you could be there in 2yrs time due to property price inceases and what you'll have paid off? If so, this could make the 2yr more favourable if you think you'll qualify for better rates in 2yrs time due to improved LTV.* Not likely to need to end your tenancies/sell in the next X yrs (depending on which product you go for)?


At 60% LTV now. Most BTL mortgages are interest only so balance not reducing. However you have the option of over paying or lump sums if funds available.

Have long term tenants & no plans to sell currently, however you never know what the future holds....

Swaying towards the 5 year fix though.....
Edited by: "cazsilver" 8th Mar
A very old fashioned view is to pay off your debts.

Or you can double guess the markets. Lots who have been doing that with their Interest only mortgages are now doing Equity Release. And I'm not talking about 80 year olds. People in their 60s are doing it.

Or you can think about the impact of the Dalai Jezza and St John the Marxist running the economy with tenants being given rights that make even today's low chance of evicting bad tenants look generous.
Edited by: "ccnp" 8th Mar
I had this dilemma a couple of weeks ago, had 2 buy to lets with fixed rates running out one month apart. Decided to go for a five year fix for peace of mind as not thinking of selling in the near future and also due to long terms tenants. Just didn’t want to go through the same decision making process In 2 years time (which will come around quicker than you think. Had the fees added to the loan amount.
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