Mortgage Rate Rises

[fez]

Pulled even for those who have the decision in princple?

This is what I am wondering too. There will be thousands of people who have agreements in principle at rates the bank will not want to offer. If those are "updated" or rescinded a lot of those house purchases will fall apart.

 

[Firestar_3x]

Our fixed rate comes to an end late next year, ~9 years into a 25 year mortgage on the main house.

We've decided to pay it off come renewal time, not paying 6% or whatever it will be then.

 

[fez]

Our fixed rate comes to an end late next year, ~9 years into a 25 year mortgage on the main house.

We've decided to pay it off come renewal time, not paying 6% or whatever it will be then.

Would be nice to have to decide whether to pay off the remaining 2/3rds of your mortgage or invest that money in the markets. How the other half live eh

 

[413x]

Aips aren't really worth anything right? No binding in them.

I have read that formal offers can't be just rescinded, but a few posters working in the field have suggested this is happening?

Even the BBC said it couldn't?

(excluding drops in house prices and failed last minute credit checks.. These are in ts & Cs)

 

[Skillmister]

This is what I am wondering too. There will be thousands of people who have agreements in principle at rates the bank will not want to offer. If those are "updated" or rescinded a lot of those house purchases will fall apart.

An agreement in principle is meaningless its not a mortgage offer.

 

[delta0]

An agreement in principle is meaningless its not a mortgage offer.

Exactly. They need to have the formal mortgage review and pass the stress tests. Most mortgage companies were stress testing 5-5.5% they are probably going to stress a bit above that now. Valuations are going to be tougher too.

 

[subbytna]

With the country in a recession (we are already), the usual way to get a country out of a recession (people spending) isn't here any more due to energy prices and now higher mortgage prices. This really is becoming a serious bovine excrement storm. Anyone taking out credit now is a fool, batten down the hatches as this is going to be prolonged and ugly.

 

[Surveyor]

Exactly. They need to have the formal mortgage review and pass the stress tests. Most mortgage companies were stress testing 5-5.5% they are probably going to stress a bit above that now. Valuations are going to be tougher too.

Wasn't the stress test scrapped in August?

 

[BUDFORCE]

I have read that formal offers can't be just rescinded, but a few posters working in the field have suggested this is happening?

Even the BBC said it couldn't?

It depends if its regulated or non regulated.

So most residential mortgages (eg one you take for your own house to live in) are regulated and yes they cannot withdraw those unless there are certain circumstances, one good example of lenders share information and have fraud systems, such an Hunter, CIFAS, SIRA etc - if a lender offered on a regulated mortgage then found out through one of these systems the guy or lass was a naughty boy they have the right to pull it.

BTL mortgages are generally unregulated, and therefore can be pulled, however that obviously risks reputational damange so lenders generally wont, and is a sign of desperation if they do.

 

[JamesH85]

Wasn't the stress test scrapped in August?

It was ,however most lenders still did it.

 

[delta0]

Wasn't the stress test scrapped in August?

Mortgage providers still did it and beyond what they had to

 

[413x]

It depends if its regulated or non regulated.

So most residential mortgages (eg one you take for your own house to live in) are regulated and yes they cannot withdraw those unless there are certain circumstances, one good example of lenders share information and have fraud systems, such an Hunter, CIFAS, SIRA etc - if a lender offered on a regulated mortgage then found out through one of these systems the guy or lass was a naughty boy they have the right to pull it.

BTL mortgages are generally unregulated, and therefore can be pulled, however that obviously risks reputational damange so lenders generally wont, and is a sign of desperation if they do.

That makes it clear.

 

[BUDFORCE]

That makes it clear.

Unlike the BBC which as usual leaves out half the facts.

 

[Nitefly]

Probably hasn’t changed since this morning but a new customer at HSBC looking for a 5 year fixed <60% LTV is looking at 5.39% plus a £1k booking fee. Hurrrggn!

Was 3.09% as an existing customer on 11 August.

 

[Stu999]

Probably hasn’t changed since this morning but a new customer at HSBC looking for a 5 year fixed <60% LTV is looking at 5.39% plus a £1k booking fee. Hurrrggn!

Was 3.09% as an existing customer on 11 August.

It’s gone up substantially, the one I’ve been looking at with them has gone from high 3s / 4% to high 4s and then 5.99% today

I’m sure earlier in the year with <60% LTV you could have gotten under 2%.

 

[200sols]

Well at least the BoE have no excuses now not to whack up rates at least 2% in November.

 

[413x]

Well at least the BoE have no excuses now not to whack up rates at least 2% in November.

I just can't believe we will see 2pc the way its been going. I mean they didn't even do an emergency hike to spread the pain.

 

[Guest2]

Mines 2.21% with Halifax and comes to an end next October. No doubt by then rates will have sky rocketed.
Might put my GF on the mortgage, with part ownership and might be able to work out a better deal as have been making overpayments for the past 3 years too
Hopefully wont be too bad if we increase the mortgage repayments quite a bit

 

[tamzzy]

Might put my GF on the mortgage, with part ownership

Run that through a lawyer first and get terms drawn up
Last thing you want is breaking up with the GF and things turning nasty

 

[Richie]

Nobody was expecting interest rates to go from sub 1% to 6% in a year (which looks likely) and I've not seen any evidence of any forecasting this level of rate rise a year ago! We took on a significant mortgage in January and the banks sure as hell were not stress testing people up to 6% interest rates.

They also weren't adding a stress test for high increases in energy and food which are necessities of life.