Fixed rate interest only mortgage

[mangua]

Hi,

 

Please advise. I have an 18 years term interest only mortgage with Kensington. The mortage interest rate is fixed for two years @ 7.08%, this finishes in June 2009 and then it is followed by Kensington's standard Variable Rate (currently 8.70%). Will be mortage payments, after the fixed rate period is completed, come down to reflect the current lower interest rates (if they still apply at that time) or, would I still have to pay the 8.70%? I am not in a position to remortgage. Thank you in advance for any comments. :?

[yourbank]

If Kensington lower its SVR then it will be that rate but if they don't then it will be 8%+

[mangua]

Thank you for your speedy reply. Are you saying that to date Kensington has not lowered its SVR? If that is the case, would it be possible to change my mortgage with Kensington to a tracker mortgage following the fixed term?

[yourbank]

Thank you for your speedy reply. Are you saying that to date Kensington has not lowered its SVR? If that is the case, would it be possible to change my mortgage with Kensington to a tracker mortgage following the fixed term?

I haven't said anything that isn't in your first post. IF Kensington has lowered its Standard Variable Rate as interest rates have gone down then by definition you will get a lower rate, however, if they haven't then it will be the rate you quoted in post 1. It may be worth checking with Kensington nearer the time if they have a product that suits your needs, ie around 3 months prior to the end of the fixed rate term.