Tracker rate mortgage change

[lonmarjc]

I’m still on a 0.8% tracker. Looking at swapping to a fixed rate given the likely increases over the next few months (should have looked sooner I know).

Best rate I can see at the min is with current provider at 2.8% for 4 years

Just thought I’d get something perspectives before I take the plunge.

 

[ruben33]

@lonmarjc Stay on the tracker, I'm amazed so many people are moving off them.

 

[lonmarjc]

@ruben33 I’ve heard of a few moving off myself and that’s what got me thinking am I better off fixing now for a few years.

 

[ruben33]

@lonmarjc Inflation is already dropping, I'd personally hold off

 

[nalle]

@ruben33 Yes we've waited to see what is happening. We're +1.25% so a bit higher than OP, but weren't going to make a knee jerk reaction at first increase.

I think ppl have been switching due to articles in papers.

I do think there'll be further increases into 2023,but at smaller increments, possibly another 1% throughout the year. I'm hoping not much more than that.

 

[mayz]

@lonmarjc Once you give up your tracker, you will never get another, so there's that to keep in mind; you'll be at the mercy of whatever the lenders feel like charging for the remainder of your loan. Locking in for just four years might not be that advantageous if you still have a long time left on your term and you end up paying a lot more than the ECB refinance rate plus 0.8% after four years. It's also risky if your LTV is still high, as you'll have a difficult time switching mortgages to take advantage of lower rates if property prices fall in the near future.

 

[lonmarjc]

Thanks for the comments all. I did wonder if longer term it may be worth keeping the tracker. I’m mindful that once I’m off I’m off!

Locking in at a rate now might be advantageous in the medium term but hard to know what the future might look like especially if we don’t get a soft landing on inflation.

I could have gotten 2.05% fixed a few months back and now its 2.8%. After ECB meeting next week it will likely rise again and I supposed that’s what was making me as the question. Do I lock in or just ride it out.

 

[nalle]

@lonmarjc Another 1/2 percentage point this month. I'm on same boat as you, but for now on the ride it out mindset. Hoping it'll pay off.

 

[filarks]

@lonmarjc Do not change from the tracker rate. the tracker rate is and always will the best rate in the market regardless of rate increases

 

[tabatha2107]

@filarks The current ECB repo rate is 2%. Add an .8% margin, and they're at 2.8%.

Until very recently, Avant were doing very long-term fixed rates in the low 2% territory.

I'll not try predict the future, but the mindset of tracker=best is under threat.

 

[ibechara]

@filarks That's simply not true.

 

[jorjor]

@filarks I was on a 1.75 tracker retention after moving house so moved to AIB fixed for 5 years where I can overpay with no fees at 2.1% fixed where I will have it paid off in 5 years.

There is a lot of factors at play. It depends on how long your term is. It depends if you plan on overpaying or not to reduce it etc.

 

[eddiedragon]

@lonmarjc I changed my 1.3% tracker for a 3.1% 10 year fixed.

I'm in two minds about where rates will go.

On one hand, I can see the whole country being in trouble if the ECB rates go to 4% so I wonder how high would be realistic. Not that the ECB is particularly considered with Ireland however I would assume other countries are in the a similar boat.

On the other hand inflation is a regime changing force that is hard to control. Politician can't ignore this not matter how unpopular rate hiking is

 

[calebminson]

@eddiedragon Given the Chief Economist of the ECB is Irish, the EU finance commissioner is Irish and the Auditor general (whatever the proper title is) is Irish, and the Eurogroup President is Irish, do you think we might hold more sway than you think on the finance front?

I know commissioners are meant to leave national bias behind, but that's a nice ideal, IMO.