Soldato
Me too. The joys of being responsible and having stability in life.
I mentioned this earlier in the thread...
Mortgage Rate Rises
- Thread starter glenimp617
- Start date
I mentioned this earlier in the thread...
It depends on the cost of the mortgage relative to the rate of return. I paid off a chunk of my mortgage in the past when base rate was about 5.5%. Then it dropped and my tracker mortgage was 1.09% so I just let it run.
Personally I'd veer towards paying off the mortgage but I generally don't like having debt unless I'm confident it is earning me more than it costs. Paying off the mortgage now eliminates the risk that your investments tank to the extent they are no longer worth more than the mortgage.
If you are good at investing money it probably makes more sense to have the capital 'out there earning more money'.
There's also a school of thought that would say "what is the point of investment, if it isn't for ultimately spending on things?" and paying off your mortgage is effectively spending some of it on a house. It's obviously more nuanced than that because you might end up with more money to spend at the end if your investments performed well and you just let the mortgage tick down, but in essence what I'm saying is most people would regard using investments to clear debt on a house as a 'solid' choice compared to say flash cars and luxury holidays.
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Don't bite pal. Basically just 40yr old dudes still living at home
Man of Honour
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- 21 Nov 2004
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I’d buy another property and rent it out.
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Yeah the people almost gloating in this thread pee me off.
I bought this house with my ex wife. We split last year and I bought her out to keep some stability for my daughter. It's shared ownership so the mortgage and rent is affordable. But I'm a single father and if it goes up too much I'm stuffed with the added hit on energy prices and general inflation taking out a lot of my slack already.
So before you selfish gits have a laugh about people struggling have a think. It's not just me that will be affected, my 7 year old daughter who has just been through a torrid year with our split will suffer too.
I bought this house with my ex wife. We split last year and I bought her out to keep some stability for my daughter. It's shared ownership so the mortgage and rent is affordable. But I'm a single father and if it goes up too much I'm stuffed with the added hit on energy prices and general inflation taking out a lot of my slack already.
So before you selfish gits have a laugh about people struggling have a think. It's not just me that will be affected, my 7 year old daughter who has just been through a torrid year with our split will suffer too.
Soldato
No one here is gloating?
Soldato
My remortgage completed today. Our 2-year fix was due to expire this month but I bit the bullet early and starting looking for new deals six months ago when rates started climbing and managed to secure a 3.31% 5-year fix with Barclays which was good for six months. Our mortgage has gone up about £200 per month but I can afford that - 5-6% would have been a real belt-tightener.
I'm expecting rates to stay high for circa two years and then if they drop significantly it may be worth my while to take a hit on early repayment fees and re-mortgage again to get a lower rate, I'll decide in a couple of years time.
Overall I'm satisfied with this deal and very glad I took early action.
I'm expecting rates to stay high for circa two years and then if they drop significantly it may be worth my while to take a hit on early repayment fees and re-mortgage again to get a lower rate, I'll decide in a couple of years time.
Overall I'm satisfied with this deal and very glad I took early action.
Soldato
What did you go from?
It seems banks expect a drop in 2 years, however, what that drop will be is anyone's guess. Back down to 1%? I'd be amazed if so
Associate
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- 16 Nov 2011
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- 169
We re-mortgaged a couple years ago when we had an extension built and doubled the outstanding balance, but we were looking to pay it off in no more than 10 years and managed to get a fixed rate for 5 years and have been overpaying as well to bring the balance down
Hopefully by the time we come to the end of this deal, the rates might have dropped a bit, but we might then have a decision to make on trying to fix another 5 year deal or going with a couple shorter terms to get better rates overall
I do feel for anyone who has just bought a house recently or how much the changes have impacted whether or not people can even buy what they might want
Hopefully by the time we come to the end of this deal, the rates might have dropped a bit, but we might then have a decision to make on trying to fix another 5 year deal or going with a couple shorter terms to get better rates overall
I do feel for anyone who has just bought a house recently or how much the changes have impacted whether or not people can even buy what they might want
The 1.93 I took out with 2k exit fee is still looking good.
But not as good as it was.
How long would it take to make that back?
Its about 100ppm for me per percent rate increase.
With rates at 3.5ish take 1-2 years to be "in profit" its anyone's guess but rates could be back down to. 2-3pc in a year or 2.
So although still absolutely the right decision it's not as clear cut as it was.
But piece of mind is worth it. I'd be regretting any long term 4+pc fixes though
But not as good as it was.
How long would it take to make that back?
Its about 100ppm for me per percent rate increase.
With rates at 3.5ish take 1-2 years to be "in profit" its anyone's guess but rates could be back down to. 2-3pc in a year or 2.
So although still absolutely the right decision it's not as clear cut as it was.
But piece of mind is worth it. I'd be regretting any long term 4+pc fixes though
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Soldato
We were on 1.99%.
Regarding the gloating you'll find it works both ways; in a booming market people let you know how their home is now worth 50% more than they paid 4 years ago and they are trying to decide between a single storey or two storey extension paid for with the increasing equity. Or that they have long term fix several points below base rate. You can miss the boat on the way out to sea and be stranded on a desert island [i.e. stuck at the bottom of the ladder] just as much as you can go down with it.
This kind of fosters certain feelings, like the people who have missed the boat sometimes wish for it to sink because it means that hopefully another boat will come along in future and this time they can get onboard. They were maybe quite cautious and meanwhile the risk takers have been making hay through rising equity and they feel left behind and need some sort of correction to catch up.
This kind of fosters certain feelings, like the people who have missed the boat sometimes wish for it to sink because it means that hopefully another boat will come along in future and this time they can get onboard. They were maybe quite cautious and meanwhile the risk takers have been making hay through rising equity and they feel left behind and need some sort of correction to catch up.
Soldato
@HangTime i think the issue isn't that people want the drop in prices, that's fine I don't think anyone objects to someone saying "I hope there is a drop as I can't afford the current amount, but a 20 percent or whatver drop means I can finally buy", but instead, they object to "I can't wait for people's houses to be repossessed so I can buy them. Fun times ahead"
This is why you shouldn't get mortgages from Delboy down the market.
Also when transferring large sums, send a quid first and make sure it arrives, before sending large amounts.
Tried doing that when transfering my deposit money, ended up having to call multiple times to unblock things as they just insta blocked my accounts due to "fraud".
Had quite a good chunk to transfer so had to do it in 4 seperate trasactions due to limits, 4 phone calls in a row each time telling them what I am doing and to stop blocking my own money
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Soldato
Missed the news yesterday that Jan prices went up 0.9% since Dec? Also number of properties coming to market fell.
Would be great if houses stopped keeping up with inflation.
Just looked. Seems like it's same old story. Just too many people and not enough houses. Falling prices people hold back. But soon as there's a sniff of stability.. Back to normal.
Crazy really. If what we've been through can't drop prices by 10pc I don't know what will apart from catastrophic stuff
House prices went up??
Just looked. Seems like it's same old story. Just too many people and not enough houses. Falling prices people hold back. But soon as there's a sniff of stability.. Back to normal.
Crazy really. If what we've been through can't drop prices by 10pc I don't know what will apart from catastrophic stuff
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Soldato
It’s fundamentally what will keep house prices rising over the long term. Supply is very low.
Soldato
I'm in a similar position (although with not as much invested) and am thinking to take the majority of my ISA and pay off some of the mortgage.
Up to know I'd been paying the mortgage and bills with my brother, but he's moving out in April and the mortgage needs renewing. If I do nothing, it will go up about £300 a month. If I use some of my ISA, I can bring it to slightly lower than now. I currently put £800 into savings/investments a month, so I'm fairly sure I can afford the increase, I just wont be investing like I was, but then I see paying the mortgage as similar to an investment. I still have 17 years to go, but basically when I decide to move out of London, there are some places I could probably buy outright.
I was going to only sign a 2 year deal, in case I don't like know having the same disposable income and want to move to the (cheap) countryside. If I sign a 5 year, but sell up in 2 or 3, do I pay a penalty?
Given I'm told things are peaking in the next few months, is a tracker a better option than fixed?
The options I've been shown, a 2 year tracker has a lower rate (3.7ish) than a 2 or 5 year fixed (4.6ish) so the shorter tracker seems a no brainer?