Looking for a reliable repayment plan in a world of fluctuating interest rates? A fixed rate mortgage can fix the amount of interest you pay. Even for up to fifteen years.
But with such security comes a commitment, and with such a long fix you may find it difficult to move home or remortgage until your deal has run its course. Is a fifteen year fix for you?
A 15 year fixed-rate is a fairly rare mortgage product. With this you agree to a mortgage where the interest rate will remain the same for 15 years.
This means you’ll know exactly what you’ll repay each month over that time. But, it is difficult to move home during that period or remortage without having to pay hefty exit penalties.
If you like the idea of facing no interest rate surprises for 15 years, and are confident you aren’t going to move house then a 15-year fix could be right for you. The main benefit of them is you don’t have to worry about interest rates and won’t have to pay the fees involved in remortgaging for many, many years.
But there are serious downsides. Can you be sure that your circumstances won’t change for 15 years? It is a very long time to commit to a mortgage deal.
Also, you won’t benefit from being able to remortgage to a better rate as you repay your mortgage and owe less.