Mortgage Rate Rises

Simon0001 said:
Most likely. If mortgages were affordable less people would rent.
Click to expand...
You live in a dream land, people can't get mortgages because they are paying rent and can't save deposit required. Every time I've looked at the cost of renting around here for about 10 years, rent is more expensive than my mortgage payments.
 
Last edited:
Paid our mortgage off a few years ago when everyone else we knew was going on about how the best thing in the world is to finance as much as you can (house, cars, holidays) as money is so cheap. The vindication of not having to worry a single bit about interest rate rises is very nice at the moment. I'm actually heating the house at the moment with all our self-smuggness so that's even helping with the energy bills!
 
Simon0001 said:
They should learn discipline and save the full amount and then buy the house outright.
Click to expand...
You're probably wasting your time telling people that on this forum. They just want an easy life which involves everyone paying for their existence. Don't even think about mentioning a second job - going by their post count and frequency of postings, i'd guess most of them don't even have a job at all.
 
squerble said:
Stop skirting around the issue. What was the actual loan value? Or are you being intentionally vague because the going rate for a 2-bed end terrace was likely in the low tens of thousands, if not even single-digit thousands?

9% interest on a £30k loan vs 9% on a £175k loan is nearly 6x higher payments. Unless you're going to include your actual loan value then your argument is null and void.

EDIT: You edited in your values after I'd quoted and replied. A salary of £25k isn't far off the median salary now in 2022. When did you buy the house?
Click to expand...

Shock Horror as wages have not gone up with inflation. My father was easily on 25+k when we moved in 1991 and bought a 4 bed for 50K. That's a house for two years salary. Completely unheard of today.

Interest rates simply cannot stay this low as houses will become unobtainable for the vast majority. It really is a terrible situation this country is in as interest rates should have gone up slowly at least 5 years ago.
 
Simon0001 said:
They should learn discipline and save the full amount and then buy the house outright.
Click to expand...

I recently talked with my financial advisor about whether to overpay on our mortgage to clear it within the next few years. He suggested that I could do that if my wife and I just want the peace of mind that comes with owning our home, but financially, it makes far more sense to invest the money elsewhere, given that we're on a 30 year 2.5% APR (lifetime) mortgage, where our mortgage payment is only a small fraction of our household budget. Also, as mortgage interest is tax deductible in the USA, the 2.5% APR is more like 1.75% APR after taxes are deducted, and a 1 year fixed term cash savings account will pay 3.25% interest right now.
 
jon86 said:
I recently talked with my financial advisor about whether to overpay on our mortgage to clear it within the next few years. He suggested that I could do that if my wife and I just want the peace of mind that comes with owning our home, but financially, it makes far more sense to invest the money elsewhere, given that we're on a 30 year 2.5% APR (lifetime) mortgage, where our mortgage payment is only a small fraction of our household budget. Also, as mortgage interest is tax deductible in the USA, the 2.5% APR is more like 1.75% APR after taxes are deducted, and a 1 year fixed term cash savings account will pay 3.25% interest right now.
Click to expand...

Uhuh.

And your financial advisor is taking a cut?
 
I’m quite pleased my mortgage rate is about to shoot up by 4%. I was in danger of paying more each month for my energy than for my mortgage but balance has now been restored……;)
 
Last edited:
adam cool dude said:
Shock Horror as wages have not gone up with inflation. My father was easily on 25+k when we moved in 1991 and bought a 4 bed for 50K. That's a house for two years salary. Completely unheard of today.

Interest rates simply cannot stay this low as houses will become unobtainable for the vast majority. It really is a terrible situation this country is in as interest rates should have gone up slowly at least 5 years ago.
Click to expand...

I don't see how interest rates going up to what they were in 1991 results in houses dropping to 2X wage prices lol.
 
Peerzy said:
Paid our mortgage off a few years ago when everyone else we knew was going on about how the best thing in the world is to finance as much as you can (house, cars, holidays) as money is so cheap. The vindication of not having to worry a single bit about interest rate rises is very nice at the moment. I'm actually heating the house at the moment with all our self-smuggness so that's even helping with the energy bills!
Click to expand...

We only have low 5 digits left and locked in to 3.48% now for 3 years. Our mortgage has gone up £528 a year and £1200 a year for energy which isn't as bad as old Trussy is giving us £400. However with my new job only being 6 miles down the road my annual commute has gone down 2520 miles. Saving £701. Have cancelled sky sports, bt-sport and changed fibre provider saving me £840 a year. That leaves me £171 a year worse off which I will take considering this "crisis" we are in. :D
 
Martini1991 said:
I don't see how interest rates going up to what they were in 1991 results in houses dropping to 2X wage prices lol.
Click to expand...

Not dropping but would have kerbed rises but it is too late now. Houses were still reasonably affordable even 5 years ago. The fact everyone has had cheap credit for so long has driven decent houses to unreachable levels for most people.
 
adam cool dude said:
Not dropping but would have kerbed rises but it is too late now. Houses were still reasonably affordable even 5 years ago. The fact everyone has had cheap credit for so long has driven decent houses to unreachable levels for most people.
Click to expand...

And yet my house goes from affordable to unaffordable with the interest hike.

Before COVID they were generally fine where I am price wise, still way lower per month than rent.

UK housing is an absolute mess, and no one has the appetite to fix it.
 
Martini1991 said:
And yet my house goes from affordable to unaffordable with the interest hike.

Before COVID they were generally fine where I am price wise, still way lower per month than rent.

UK housing is an absolute mess, and no one has the appetite to fix it.
Click to expand...

Yes in the present but I would have thought in the next couple of years they will drop significantly to more reasonable levels.
 
LabR@t said:
www.telegraph.co.uk

Homeowners gambling on variable rate mortgage deals

Borrowers attempt to reduce repayments by shunning fixed-rate loans
www.telegraph.co.uk www.telegraph.co.uk

Risky!
Click to expand...
Can’t read the article, but this is what I’m doing.

My tracker ends in Nov next year. Sitting at 2.8% right now. Nationwide are offering me a fix of 5.8%

I’d rather put away the additional cost and put it towards the new price come November. Whatever the rate may be. I can’t see it being more that 6.5-7%
 
You must log in or register to reply here.
Back
Top Bottom