Mortgage Rate Rises

Freddie1980 · 8 Jul 2022 at 14:19

I got new deal starting in July and secured a 2.15% interest rate. Out morbid curiosity I jumped on to Compare The Market and put in the same details that I had for my reportage and the lowest rate is now 3.1% which for me with a £206k mortgage represents s £150 a month extra in repayments. The plan now is to pay this down as fast as possible over the next 5 years.

Maccy · 8 Jul 2022 at 14:21

Freefaller said:
On a slightly related subject, how accurate are zoopla evaluations? As it seriously affects LTV if they're basing their data off that.

When we took out our mortgage they didn't send anyone round to inspect the house which surprised me.

Generous, usually above the actual. There's about £60k difference between Zoopla and Natwest (our current provider) valuations.

HungryHippos · 8 Jul 2022 at 14:23

Freefaller said:
On a slightly related subject, how accurate are zoopla evaluations? As it seriously affects LTV if they're basing their data off that.

When we took out our mortgage they didn't send anyone round to inspect the house which surprised me.

Zoopla will be based somewhat on last sale price/date and the average price increase in your area since then. It's not a perfect science, I doubt they use Zoopla but they probably use something a bit like it.

Destination said:
Agree, my lifetime tracker is base +0.39, so I'll just have to live with any increase as a fix with fees will no doubt rattle up higher anyway

When I got mine they didn't really seem to be an option, guess they phase these things in and out over time. When I was looking at houses way back in like 2009/2010 I do remember having an offer for a lifetime tracker, but when I bought in 2013 the same wasn't possible.

dLockers said:
I can either spend my cash on nonsense and participant in the consumption economy -- or I can top-up my net wealth with an asset that'll either outperform the market or distinctly keep up with it.

Yep could not agree more, and unlike other investments it's a surefire bet it will save you cash.

Side bonus: with Nationwide I can use prior overpayments instead of actual ones, so should I lose my job I can ask them to stop billing me and pay out of overpayments instead.

Only negative is you lack flex with the money you've put in, but if owning more of your house and building a mortgage payment safety net are more important, then overpaying is definitely a great option where you can.

413x · 8 Jul 2022 at 14:24

Freefaller said:
On a slightly related subject, how accurate are zoopla evaluations? As it seriously affects LTV if they're basing their data off that.

When we took out our mortgage they didn't send anyone round to inspect the house which surprised me.

My property was downvalued significantly.
House was near the 75/60 LTV border on zoopla
Mortgage lender valued it near the 85/75 LTV border

Massive difference
I believe the difference was a 10pc (roughly) down value of the total house value

This was also a desk based valuation

FBi7 · 8 Jul 2022 at 14:26

Freefaller said:
On a slightly related subject, how accurate are zoopla evaluations? As it seriously affects LTV if they're basing their data off that.

When we took out our mortgage they didn't send anyone round to inspect the house which surprised me.

Probably not very. Zoopla, with a 'Low Confidence' caveat, states I've made between -£5k and +£98k in 15 months. These figures seem to change regularly. Fortunately, I'm fixed at 1.58% til March 2026.

ivrytwr3 · 8 Jul 2022 at 14:33

krooton said:
Yikes, currently on a fix of 1.28% until May 2023, if I wanted to re-fix now for 5 years, it would be at 3.5%

kai said:
Secured a 2 year fixed in January with Santander - 1.09% phew!

But the BoE base rate is 1.25%, you mean 1.28 and 1.09 on top of the BoE?

Mine:

Bank of England base rate
1.25%
Amount tracking Bank of England base rate by
0.75%

So my total Current interest rate is 2.00%.

413x · 8 Jul 2022 at 14:34

ivrytwr3 said:
But the BoE base rate is 1.25%, you mean 1.28 and 1.09 on top of the BoE?

Mine:

Bank of England base rate
1.25%
Amount tracking Bank of England base rate by
0.75%

So my total Current interest rate is 2.00%.

No. They are fixed.
They pay those rates to the end of thier fixed term

HungryHippos · 8 Jul 2022 at 14:34

ivrytwr3 said:
But the BoE base rate is 1.25%, you mean 1.28 and 1.09 on top of the BoE?

Mine:

Bank of England base rate
1.25%
Amount tracking Bank of England base rate by
0.75%

So my total Current interest rate is 2.00%.

No, when base rate was 0.1% last year I got a 5 year fix at 1%, so currently it's lower than base rate.

Good timing is everything here, with all of the stuff going on this is the one good move I made.

Mason- · 8 Jul 2022 at 14:35

Maccy said:
@Mason- I've just had started looking at figures for early exit - would be about £2400 to leave now, but monthlies could go down by about £140.

Up to you to decide then. There’s also the fee of the conveyancing and mortgage fee on top to consider. If you’re gonna fix for 5+ years it’s probably worth it. I think interest rates are only going one way.

413x · 8 Jul 2022 at 14:36

Mason- said:
Up to you to decide then. There’s also the fee of the conveyancing and mortgage fee on top to consider. If you’re gonna fix for 5+ years it’s probably worth it. I think interest rates are only going one way.

The mortgage fee and valuation fee etc are basically moot for comparison.
Those have to be paid regardless of when you remortgage.

Is all about what you think the rates will be over the next 5 years

Maccy · 8 Jul 2022 at 14:56

Mason- said:
Up to you to decide then. There’s also the fee of the conveyancing and mortgage fee on top to consider. If you’re gonna fix for 5+ years it’s probably worth it. I think interest rates are only going one way.

I've pinged figures over to our IFA and see what they think.

kai · 8 Jul 2022 at 15:06

ivrytwr3 said:
But the BoE base rate is 1.25%, you mean 1.28 and 1.09 on top of the BoE?

Mine:

Bank of England base rate
1.25%
Amount tracking Bank of England base rate by
0.75%

So my total Current interest rate is 2.00%.

No i mean 1.09%

krooton · 8 Jul 2022 at 15:09

If things look real iffy by March next year, we'll have to take on a lodger, an extra £600 a month would help.

Freefaller · 8 Jul 2022 at 15:16

FBi7 said:
Probably not very. Zoopla, with a 'Low Confidence' caveat, states I've made between -£5k and +£98k in 15 months. These figures seem to change regularly. Fortunately, I'm fixed at 1.58% til March 2026.

Yes mine have shown a ridiculous increase of over 30%. Even the lowest estimate is 80k above what we paid.

413x · 8 Jul 2022 at 15:22

krooton said:
If things look real iffy by March next year, we'll have to take on a lodger, an extra £600 a month would help.

For those with that option its certainly a lifeline

200sols · 8 Jul 2022 at 15:25

Freefaller said:
1.52% until May 2026 thank goodness... hopefully by the country and market will be in a better situation....

In this case though a 'better situation' probably means interest rates around 5%.

ivrytwr3 said:
But the BoE base rate is 1.25%, you mean 1.28 and 1.09 on top of the BoE?

For most of January the base rate was 0.25%.

Freefaller · 8 Jul 2022 at 15:31

200sols said:
In this case though a 'better situation' probably means interest rates around 5%.

For most of January the base rate was 0.25%.

Dammit... ah well, my LTV will be lower hopefully.. perhaps then a variable rate may be a better bet.

danlightbulb · 8 Jul 2022 at 15:41

dLockers said:
I can either spend my cash on nonsense and participant in the consumption economy -- or I can top-up my net wealth with an asset that'll either outperform the market or distinctly keep up with it.

Depends what you class as nonsense stuff. Fancy trainers, flash cars etc are luxuries yeah sure. But a reasonable holiday really isn't, or skill-expanding hobbies.

Syla5 · 8 Jul 2022 at 15:42

Paid an ERC to get out and then fixed for 10 years at 2.39% Its a gamble but with savings rates already up to 1.5% and above, im hoping to offset some of that gamble.

dlockers · 8 Jul 2022 at 15:43

danlightbulb said:
Depends what you class as nonsense stuff. Fancy trainers, flash cars etc are luxuries yeah sure. But a reasonable holiday really isn't, or skill-expanding hobbies.

100%. I lived in a flat share for 3 years because I valued those things and my earnings were lower. However, I had friends paying the premium for a 1 bed flat because they valued that more.

It is all relative which is why you can't whinge about folk buying expensive houses and conversely whinge about folks going on holiday.