Mortgage Rate Rises

delta0 said:
As long as you don’t change anything like the mortgage term or the amount borrowed etc. then that’s usually the case.
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Yes indeed.

Otherwise the lender, by refusing to put them on a new product, may force them into arrears. Pretty sure the FCA would take issue over this.

Off the subject but still on topic I am starting to hear some positive things, swap rates are slowly going down, and lenders are starting to reduce rates (a bit) the general consensus is we may be at the top of the "hump" right now, with things possibly improving going forward.
 
413x said:
Didn't know that.
How does that even work? Do they re assess house value etc?
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No checks or anything when I last renewed with Nationwide - all done online in 5 minutes flat. They reassess the house value (as that could affect your LTV) using algorithms I think a bit like the property portals do but I hope more sophisticated. I recall some sort of confirmation paperwork I received stating what the house value they were basing it on and it certainly being higher than what I'd paid five years earlier. For me the LTV is already so low that it wouldn't have made a difference but I don't know if there's a process whereby you can challenge what the computer says if you're on the cusp that could get you a better offer with a change in LTV.
 
matt100 said:
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.
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I'm one of the rare examples of why you would choose to be on the SVR - my mortgage deal ran out in April, but in August I was due a large sum of money to completely clear the mortgage.
None of the deals with my lender allowed early repayments without silly fees, so it was much cheaper to take a few months of SVR and box the lot off than take a new deal :)
 
BigT said:
No checks or anything when I last renewed with Nationwide - all done online in 5 minutes flat. They reassess the house value (as that could affect your LTV) using algorithms I think a bit like the property portals do but I hope more sophisticated. I recall some sort of confirmation paperwork I received stating what the house value they were basing it on and it certainly being higher than what I'd paid five years earlier. For me the LTV is already so low that it wouldn't have made a difference but I don't know if there's a process whereby you can challenge what the computer says if you're on the cusp that could get you a better offer with a change in LTV.
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Nationwide operate their own house price index - you can access it online: https://www.nationwide.co.uk/house-price-index/
They say they don't use it in a mortgage application, but i'm sure the desktop valuations they arrive at when remortgaging are based on near enough exactly the same data/algorithm.
 
Tom_ed1987 said:
Nationwide operate their own house price index - you can access it online: https://www.nationwide.co.uk/house-price-index/
They say they don't use it in a mortgage application, but i'm sure the desktop valuations they arrive at when remortgaging are based on near enough exactly the same data/algorithm.
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Just checked my Nationwide renewal from the start of the year, I moved from the BMR to a fixed rate, I was happy to be on the BMR as it gave flexibility and the rate was only around 2%, when the rates were definately going to go up I fixed for 5 years at 1.64%. Means I'd go onto the SMR as opposed to the BMR once the fix finishes but as I've only got 10 months left on my mortage once the 5 year fix finishes I'm not bothered about that.

In my paperwork it says: Value of the property assumed to prepare this information sheet: £XXX,XXX.00.
 
Tom_ed1987 said:
Nationwide operate their own house price index - you can access it online: https://www.nationwide.co.uk/house-price-index/
They say they don't use it in a mortgage application, but i'm sure the desktop valuations they arrive at when remortgaging are based on near enough exactly the same data/algorithm.
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They won't use it, almost certainly run AVMs (automated valuation model) ... I believe.... but effectively a database that is sourced outside of any mortgage lender.

I'm not saying that thing on their website isn't then in turn using the same information, just the information itself does not come from the lender.
 
BUDFORCE said:
Surprises me a little as swap rates are only just over that now.

Be interested to see if it goes up even higher.

But historical 4% is nothing too crazy.
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The historical comparison doesn’t work 4% now is much more damaging than 4% was 10/20 years ago the level of debt to income and the sheer size of the debt ensure this.
 
The only thing that is stopping me going forward with planning at the moment on my renewal is. Tracker Vs fixed.

Need to decide
 
I'm on SVR which is about to go up to 7.25%, but right now this is intentional. Was hoping to remortgage and buy out the remaining share on my shared ownership but after the rates went up it worked out more cost effective to overpay the mortgage and keep going on the shared ownership as that's basically an interest only mortgage based on the property valuation 3 years ago at 3.5%. With only 15 months left on the mortgage after overpaying it worked out safer to go on SVR and offset with savings than it did to renew on a fix unless the base rate went to 6%. I've got the choice of remortgaging to buy out the share either when property prices drop or interest rates stabilise.

My mortgage advisor thought I was being too cautious back in Autumn 2019.
 
Definitely seeing quite a lot of reduced Rightmove notifications around my way, on old houses and new builds. They are only 5% drops at the moment.
 
neocon said:
Definitely seeing quite a lot of reduced Rightmove notifications around my way, on old houses and new builds. They are only 5% drops at the moment.
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Yea I've seen a few around my way being reduced. I've seen 790k down to 720k, 590 down to 535, and 575 down to 510.

Hard to tell whether they were comically overpriced to begin with, desperate to sell, or just no one is interested in buyong atm. Probably a bit of all 3.
 
NotAGolf said:
Yea I've seen a few around my way being reduced. I've seen 790k down to 720k, 590 down to 535, and 575 down to 510.

Hard to tell whether they were comically overpriced to begin with, desperate to sell, or just no one is interested in buyong atm. Probably a bit of all 3.
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Overpriced properties round here have been dropping, but decent ones have been selling pretty quick. All about the quality of your house.
 
a1ex2001 said:
The historical comparison doesn’t work 4% now is much more damaging than 4% was 10/20 years ago the level of debt to income and the sheer size of the debt ensure this.
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But it does with 4% now and 8% or more back in the day. My last mortgage was 60k in 2003 with a record low for me of 4,95% fixed.

Remember salaries were a tenth of today's.

Fixed mortgages were rare before that and we used to budget on a variable going to 10% and once it got to 15% briefly. Even Martin Lewis agreed that bank rates of about 1% were unlikely to return and were extreme lows not seen in 300 years.
 
Hagar said:
But it does with 4% now and 8% or more back in the day. My last mortgage was 60k in 2003 with a record low for me of 4,95% fixed.

Remember salaries were a tenth of today's.

Fixed mortgages were rare before that and we used to budget on a variable going to 10% and once it got to 15% briefly. Even Martin Lewis agreed that bank rates of about 1% were unlikely to return and were extreme lows not seen in 300 years.
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4% today is more like an equivalent of 20% in the 80s era. Its not the same.
 
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