Mortgage Rate Rises

[413x]

LOL!

This is going to be what screws many many people in next year or so.

There will be a fair few FTB on 2 year fixes taken out 2020-2022.
Peak of the market.

They may be negative come renewal with the house price falls. They may not meet the affordability criteria going forward.

They'll be stuck on 6-8pc coming off what might be 1-3pc

RIP

 

[delta0]

House prices dropped for the 4th month in a row. Should be the beginning of a housing crash. Sucks if you just bought a house. A friend didn't get into positive equity untill nearly 10 years after the 08 crash. Some people are predicting up to 20pc which even still would only take you back to 2021 levels.

Prices aren’t even down over the last 12 months and were flat last month. The recession is expected to be avoided and interest rates are already on a downward trend despite the recent increase in the base rate they are lower than before. It’s wishful to think there would be any significant falls.

 

[delta0]

LOL!

Why would you choose to go onto an SVR? This is always a silly rate.

 

[glenimp617]

Why would you choose to go onto an SVR? This is always a silly rate.

Nobody who has a choice. The only thing I can think of is someone who has a large amount of money coming through and wants to pay it off, so maybe stay on SVR for a month or two. Can't think of any other reason. Now....if you don't have a choice of course.

 

[Yaayuh!]

Why would you choose to go onto an SVR? This is always a silly rate.

You wouldn’t.

 

[mattx4]

I ended up stuck on a 7% SVR for a few months thanks to poor planning on my part.

Remember you can lock in rates and renew mortgages 6 months before your current rate expires don't leave to the last minute

 

[matt100]

Why would you choose is obviously you wouldn't, how could you end up there is easy though.

You end up in a place where you can't remortgage either through debt/bad credit/negative equity etc. Just ask tons of ex northern rock customers.

 

[EvilRob]

I believe it's the below:

Tracker is at 4%

Fixed at 4.65% for two years.

As much as I'd like to be ballsy and go for the tracker hoping the rates will stay similar or decrease, I'd probably fix for the security.
I've lost on this strategy in the past. Winning at the moment, though.

 

[Brazo]

Had to endure one month on the SVR before new mortgage kicked in which completed yesterday. 5.25% fixed for five years. Might not sound great but it’s an offset mortgage so actual rate is much closer to 1.25%.

 

[EvilRob]

You wouldn’t.

So what did you get instead?

 

[EvilRob]

Had to endure one month on the SVR before new mortgage kicked in which completed yesterday. 5.25% fixed for five years. Might not sound great but it’s an offset mortgage so actual rate is much closer to 1.25%.

So you are offsetting 80% or something? How come?
Not sure I would then say actual rate is 1.25% as you are not counting the opportunity cost of not investing in a 3-4% interest fixed rate savings account are you?

 

[Brazo]

So you are offsetting 80% or something? How come?
Not sure I would then say actual rate is 1.25% as you are not counting the opportunity cost of not investing in a 3-4% interest fixed rate savings account are you?

Your correct and yes it was an approximation by saying 1.25%.

 

[EvilRob]

Delete

 

[OldKitMan]

This is going to be what screws many many people in next year or so.

There will be a fair few FTB on 2 year fixes taken out 2020-2022.
Peak of the market.

They may be negative come renewal with the house price falls. They may not meet the affordability criteria going forward.

They'll be stuck on 6-8pc coming off what might be 1-3pc

RIP

You should be able to change your deal with no affordability checks with your existing lender. I'm sure I read that is 'the law'. Certainly Nationwide state that there are no affordability checks when moving to a new deal as an existing mortgage holder with them.

 

[delta0]

You should be able to change your deal with no affordability checks with your existing lender. I'm sure I read that is 'the law'. Certainly Nationwide state that there are no affordability checks when moving to a new deal as an existing mortgage holder with them.

As long as you don’t change anything like the mortgage term or the amount borrowed etc. then that’s usually the case.

 

[Yaayuh!]

So what did you get instead?

Haven’t done anything with it yet.

 

[413x]

You should be able to change your deal with no affordability checks with your existing lender. I'm sure I read that is 'the law'. Certainly Nationwide state that there are no affordability checks when moving to a new deal as an existing mortgage holder with them.

Didn't know that.
How does that even work? Do they re assess house value etc?

 

[matt100]

Didn't know that.
How does that even work? Do they re assess house value etc?

You don't change it I assume, that's the point.

 

[EvilRob]

Didn't know that.
How does that even work? Do they re assess house value etc?

Yes, you will still be stuck on SVR with existing lender if you don't have a good enough LTV.

 

[Zefan]

You don't change it I assume, that's the point.

This is what we've done in the past, it's essentially just like choosing an energy tariff. No documents required even if I recall correctly (Halifax).