2022 mini-budget discussion

[413x]

Rip

Offer any other services?

Nuts. Apparently!
Will certainly be shelling out!

 

[Deleted User 298457]

You'll be reet with 6-7% yeah.

Stress test said so, so much be true?

Nuts. Apparently!
Will certainly be shelling out!

Get out

 

[Kenai]

50% of variables are locked for 5 years

How is a variable mortgage locked for 5 years? Surely if it's locked, by definition it's not variable?

 

[chroniclard]

Labour Shadow chancellor speech wasnt bad, could get behind some of those ideas. Far more credible and responsible than the current lot of chancers.

 

[Deleted User 298457]

How is a variable mortgage locked for 5 years? Surely if it's locked, by definition it's not variable?

You lock in to variable mortgages

Fully variable are so $lol that only useful for very, very, very short term borrowing.

 

[Kenai]

You lock in to variable mortgages

Fully variable are so $lol that only useful for very, very, very short term borrowing.

Presumably 'lock in' is meaning something different to 'fix' but still not something I've seen before.

Would be interested in an example to read up on

Edit - is this just referring to the initial rate periods of tracker mortgages? Not heard them referred to as locking in but I guess the term makes sense

 

[Deleted User 298457]

Presumably 'lock in' is meaning something different to 'fix' but still not something I've seen before.

Would be interested in an example to read up on

https://www.moneysupermarket.com/mortgages/rates-table/home-purchase/?propertyValue=700000&mortgageAmount=600000&remainingTerm=25&repaymentMethod=Repayment&mortgageType=Variable&mortgageTerm=TwoYears&sortState=MonthlyRepaymentAmount&from=Help-me-choose

 

[Dis86]

Rip

Offer any other services?

At this rate whatever you want!

 

[R.O.S.S.I]

So the real question is do I wait till mid next year to buy a house in the hope there are tons of defaults and lots of repossessions hitting the market and prices drop like a stone OR do I bite the bullet now and just get on the ladder (again) in the hope of getting something locked in before the further impending rises? Not sure what is the best idea atm.

 

[Deleted User 298457]

So the real question is do I wait till mid next year to buy a house in the hope there are tons of defaults and lots of repossessions hitting the market and prices drop like a stone OR do I bite the bullet now and just get on the ladder (again) in the hope of getting something locked in before the further impending rises? Not sure what is the best idea atm.

Get on the ladder now. If it really hits the fan I'll just go interest only and wait this period out. You won't be seeing defaults like 2008 as this crisis isn't mortgage led.

 

[Minusorange]

You won't be seeing defaults like 2008 as this crisis isn't mortgage led.

No it'll be more like the 90's, I'd personally wait if I could afford to wait

 

[Deleted User 298457]

No it'll be more like the 90's, I'd personally wait if I could afford to wait

Na, the 1990s crisis had the end of the Cold War as a cause. We are just starting one! Totally different

 

[LabR@t]

Na, the 1990s crisis had the end of the Cold War as a cause. We are just starting one! Totally different

Prelude to world war

 

[Stu999]

Get on the ladder now. If it really hits the fan I'll just go interest only and wait this period out. You won't be seeing defaults like 2008 as this crisis isn't mortgage led.

There were virtually no defaults in 2008 because the government and BoE bet the economy on house prices. 0% interest rates, Support for Mortgage Interest (SMI) scheme and so on.

 

[purplesky]

There were virtually no defaults in 2008 because the government and BoE bet the economy on house prices. 0% interest rates, Support for Mortgage Interest (SMI) scheme and so on.

Indeed. 2008 was a banking crisis. It was always going to have the kitchen sink thrown at it through ultra low interest rates and QE. Banks are in good shape today and can withstand very hefty house price falls. They'll throw those with unserviceable debts under a bus.

 

[fez]

Indeed. 2008 was a banking crisis. It was always going to have the kitchen sink thrown at it through ultra low interest rates and QE. Banks are in good shape today and can withstand very hefty house price falls. They'll throw those with unserviceable debts under a bus.

Considering there are a large number of people taking out 90% or worse LTV mortgages, a 25% fall would potentially leave a lot of people thinking about declaring bankruptcy. That could cause banks a lot of issues.

 

[Slam62]

Indeed. 2008 was a banking crisis. It was always going to have the kitchen sink thrown at it through ultra low interest rates and QE. Banks are in good shape today and can withstand very hefty house price falls. They'll throw those with unserviceable debts under a bus.

QE has been done to death now and is part of the problem. Its nothing to do with throwing people under a bus ,they have no options. Apart from cutting taxes, which makes things worse.

 

[purplesky]

Considering there are a large number of people taking out 90% or worse LTV mortgages, a 25% fall would potentially leave a lot of people thinking about declaring bankruptcy. That could cause banks a lot of issues.

The loans were on the back of QE. Banks could never lose, nor will they.
Make no mistake, bankruptcy for a bank and an individual are two very different things.

 

[Slam62]

The loans were on the back of QE. Banks could never lose, nor will they.
Make no mistake, bankruptcy for a bank and an individual are two very different things.

Of course banks lose, but they get managed out.

 

[purplesky]

QE has been done to death now and is part of the problem. Its nothing to do with throwing people under a bus ,they have no options. Apart from cutting taxes, which makes things worse.

QE has been and gone. The banks profited massively, and they will continue to, either through those who can pay their mortgage with increased interest, or by repossession. It's all win for the banks.