Should you fix your monthly repayments for 15 years

This week when doing some periodic reading up on the industry, we saw that Virgin Money and the Yorkshire Building Society have released a product with a 15 year fixed term.

On the surface, that does appear to be a long time to fix the term of a mortgage (typically, the majority of mortgages we place are fixed for five years). However, this did get us thinking. Why would you want to fix your mortgage deal for that long?

What is a 15 year fixed term

For clarification,  a fixed term on a mortgage means that the monthly payments you make on the amount you borrow is set at a fixed rate for a period of time, before moving to a variable rate which is calculated by your lender (most Mortgage Brokers will work with you to ensure that you swap to another fixed term before that happens).

With regards a 15 year fixed term, if you took out a mortgage like this tomorrow – your monthly payments would remain the same until 2034.

Why would you want to do that?

In actuality for some people, fixing mortgage payments like this does make sense.

A 15-year fix would make sense for people who are more risk-averse, and doing this now does make sense given that we are still experiencing incredibly low interest rates.

Equally, if you know you’re in your forever home and are unlikely to move in the short or medium-term – this too might be a good thing to look into.

Basically, this length of fix will give you stability over your mortgage situation for a considerable time.

Who are the sorts of people that would benefit from fixing their mortgage rate for 15 years?

Is it for everybody?

The short answer is no.

This probably isn’t the product for you if you are planning to move in the short to medium term, or if you’re likely to have some circumstances change in your life in the not too distant future (think children, upsizing, downsizing etc).

What is exciting is that this is just one of a whole range of products that is available on the mortgage market, and working with a broker means you can find the most suitable one for your needs and circumstances.

Ready to explore your options? Contact our friendly team today.

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Important: Your home may be repossessed if you do not keep up repayments on a mortgage or any debt secured upon it. A fee of up to 1% of the mortgage amount may be charged depending on individual circumstances. A typical fee is £495.

What is the next step

Step 1

Life continually moves on and with that comes increased responsibility. Whether you are buying a home or starting a family, it is an exciting time but you must plan ahead now to ensure that if something goes wrong, you and your loved ones are fully protected.    

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Speak to our friendly team to discuss your needs. Simply book an appointment and we will advise you on the right level of cover. With whole of market access we will ensure you find the right products for your individual needs.

Step 3

Our expert team have a wealth of experience helping individuals and couples plan for their futures. Whether you are considering mortgages, life insurance or income protection we will find the right option for your circumstances protecting you for the future.

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Important: Your home may be repossessed if you do not keep up repayments on a mortgage or any debt secured upon it. A fee of up to 1% of the mortgage amount may be charged depending on individual circumstances. A typical fee is £495.

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Chambers Financial Services Limited is an Appointed Representative of Quilter Mortgage Planning Limited which is authorised and regulated by the Financial Conduct Authority. Registered in England and Wales No:08201095, Registered Address:Arlington House West Station Business Park, Spital Road, Maldon, England, CM9 6FF We normally charge a fee for mortgage advice, however this will be dependent on your circumstances. Our Typical fee is £499. Click here for more information. Internet Privacy Policy

Important:
Your home may be repossessed if you do not keep up repayments on a mortgage or any debt secured upon it. A fee of up to 1% of the mortgage amount may be charged depending on individual circumstances. A typical fee is £495.

The Financial Conduct Authority do not regulate buy to let mortgages.

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