Mortgage Rate Rises

thewanted said:
Yay! Finally secured our mortgage today for a new purchase. 10 year fix, 2.79% @ 80% LTV. The cheapest comparable deal is now 3.64%, and 3.29% for a 5 year fix.
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Sensible to fix for a long time I think. Even if rates go down you haven't lost much. At high ltvs you can lose a hell of a lot on the up!
 
413x said:
Retail will start ticking up gradually. Won't be a big jump. The deals will just get worse
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Getting worse daily. Barclays have lifted their rates, it's turning into a juggling act as lenders try to balance their funding vs. market position.

My current lender wouldn't make an offer until 90 days before my fix ends, so I ended up going elsewhere (huge thanks to @EvilRob) where the new offer is secured for 6 months.

Also, I want to say that London & Country are an amazing broker. Very easy to use, straightforward communication with the adviser, a portal where you can easily see the status of your application & upload/download documents and see the case status. They have provided a perfect remortgage experience for me, though I suppose it does depend on the lender too.
 
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zegna said:
How’s that?

Current base rates 1.25%. Mortgage fixes are circa 3.6%. You’re not going to get a 0.55% spread from BoE rates, its more like 2%, maybe less but depends all on the forward market rates.

Typical fixed rates will be 5% by of the year IMO for say 80-85LTV.
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Try to keep up, if the base rate goes up 0.5% he was asking what the likely impact on end rate was. 0.75% increase would be very steep. I said likely 0.55-0.6% but its just as likely many on SVR would see exactly 0.5% increase.
Typically there is a couple/few percent on top of the base rate as the fixable mortgage rate. And maybe 1-2% on top of that to SVR.
Fixing is more to do with the cost of borrowing for the lenders than the base rate on fixes. They borrow the money add a margin and relend it. Thats then fixed and base rate is irrelevant until the fix part ends.
 
Current mortgage rates will also be pricing in future expected rate rises creating a larger gap at present. When (if) things stabilise the gap between base rate and mortgage product should reduce.
 
So I could fix for 2 years at a decent rate, only up £150/month from my current deal, but as I am 270 days away from the deal ending, it'd be a £4.6k ERC, lol

Projected increase (currently) would be +£600 month when the deal ends, so the above would save £450/month over 2 years (£10.8k), meaning the net benefit after the ERC would be £6.2k saved.

Problem is, I would need to pay the ERC in a lump sum, can't add it to the mortgage, so I am SOOL. :(
 
That seems a large difference from the current fix and what's projected in 9 months time, what interest rates are they being calculated at?
 
My 2 year fix ends in December and I was previously looking forward to dropping from my Covid 90% LTV rate of 3.6% but it looks like I'll be fixing for 5 years for roughly the same :o Was looking like about a £70pm saving going by previous rates.

I can't start the process until the 1st of August with it kicking in come October I believe so I'm hoping I get in before the next increase.
 
Jonny ///M said:
My 2 year fix ends in December and I was previously looking forward to dropping from my Covid 90% LTV rate of 3.6% but it looks like I'll be fixing for 5 years for roughly the same :o Was looking like about a £70pm saving going by previous rates.

I can't start the process until the 1st of August with it kicking in come October I believe so I'm hoping I get in before the next increase.
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I would get in as early as you can - either with your existing lender or going via an efficient mortgage broker who can secure a rate asap.

There is a likely +0.5% BoE base rate rise when they meet on the 4th August.

Once people see 4%+ interest rates everywhere on 2 year fixed deals, reality will start hitting home about how much they can afford.
 
Jonny ///M said:
My 2 year fix ends in December and I was previously looking forward to dropping from my Covid 90% LTV rate of 3.6% but it looks like I'll be fixing for 5 years for roughly the same :o Was looking like about a £70pm saving going by previous rates.

I can't start the process until the 1st of August with it kicking in come October I believe so I'm hoping I get in before the next increase.
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What is your LTV now? It works both ways - you've cleared more $ but the bank will have revalued your house (presumably increased). You could be pleasantly surprised...
 
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