Mortgage Rate Rises

glenimp617 · 9 Jul 2022 at 08:45

caff said:
I'm coming up for renewal next month, i.e. 3 months before my fixed rate ends.

I've been looking at my account but can't get a new deal until next month without heavy ERCs.

I'm wondering whether to stick my existing lender and go for a 5-year (3.25%) or 10-year (4.04%) - but both have a heavy product fee, and at 57% LTV I'm sure I can do better than these rates. They might change over the next month thhough....

Would anyone advise using a mortgage broker for a remortgage, or just shopping around yourself?

Barclays beat those deals so check them out

fredwi · 9 Jul 2022 at 08:51

I did a two year fix on 1.59 as I’m going to move soon, can refix April next year so hello interest rate of 5%

Should have done a 5 year and ported

glenimp617 · 9 Jul 2022 at 09:25

I'm thinking a 7yr fixed next year which should be the last. Just hope they don't reach 5%

Spook187 · 9 Jul 2022 at 11:00

Start my new 5 year fixed next month to 2.80% up from 1.80% from last 5 year deal, monthly payment now £350

purplesky · 9 Jul 2022 at 11:04

Spook187 said:
Start my new 5 year fixed next month to 2.80% up from 1.80% from last 5 year deal, monthly payment now £350

Hopefully you're going to be putting some money away in savings over the next 5 years so that when your new fix expires and rates are above 5% you're covered

Zatoichi.uK · 9 Jul 2022 at 11:11

We've no idea what rates will be in 5 years but yes it's sensible to pay it down whilst you can. Pure luck that my fix ended last year so now have 5 years at 1.04%. Just horrendous energy bills to contend with now. Think I'll just learn to live with 16 degrees come Oct time.

Spook187 · 9 Jul 2022 at 11:16

purplesky said:
Hopefully you're going to be putting some money away in savings over the next 5 years so that when your new fix expires and rates are above 5% you're covered

Well hopefully that's the plan, running a house on one wage has it's challenges, had to take some extra life cover to look after the Mrs in case i pop my clogs

jonneymendoza · 9 Jul 2022 at 11:20

Zatoichi.uK said:
We've no idea what rates will be in 5 years but yes it's sensible to pay it down whilst you can. Pure luck that my fix ended last year so now have 5 years at 1.04%. Just horrendous energy bills to contend with now. Think I'll just learn to live with 16 degrees come Oct time.

Buy some long Jones and thermal jumpers and you're set.

GET yourself a 4090rtx card and use that to heat up your living room or bedroom

Maundie · 9 Jul 2022 at 12:27

My 1.99% fixed term ends on 1st Oct 2024 then the final payment is on 1st Nov 2024 so hopefully it won’t have jumped too much for the last month.

Mr Wurley · 9 Jul 2022 at 12:30

Just locked in for 10 years at 2.24%. Got a feeling we could be heading for 5-8%

dlockers · 9 Jul 2022 at 12:31

Mr Wurley said:
Just locked in for 10 years at 2.24%. Got a feeling we could be heading for 5-8%

I dunno man...if banks are offering such long low rate deals, I kinda feel the system is betting the opposite. (Thinking outloud)

Mr Wurley · 9 Jul 2022 at 12:33

Maybe. All a bit of a gamble I suppose

throwaway4372 · 9 Jul 2022 at 12:41

I think it'll go to 5% in the medium-long term, so for a 10 year fix that's probably ok.
I don't think it'll go to 5% quickly, because the inflation is cost-push so the rate rises don't do much, so may as well ease us into it.

mattx2 · 9 Jul 2022 at 17:15

Rates for non residents are pretty crazy, best deal I can get is 4.25% for 5 years

hans gruber · 9 Jul 2022 at 18:50

We fixed at 5 yr 1.29% 1st April 21 with £1k product fee. Annoyingly next quarter deals were better and could have got 1.29 with no fee or 1.19, though a period on svr interest would have wiped some of that saving out.

I'm beginning to wonder if a 10 year fix would have been better. We are at around 33% ltv so will always get a decent deal, but we still owe over £100k and 5% rates would do some damage. If rates keep going north I'm going to have to start saving towards to knocking a chunk off when our deal expires.

Chuk_Chuk · 9 Jul 2022 at 19:02

With the interests rate on mortgages rising, what will this do to the price of housing?

I'm assuming they will go down but will it be by a significant amount? Is still too early to tell?

dlockers · 9 Jul 2022 at 19:10

Chuk_Chuk said:
With the interests rate on mortgages rising, what will this do to the price of housing?

I'm assuming they will go down but will it be by a significant amount? Is still too early to tell?

I think rate rises have been priced in for a while. The thing is folks are recognising that 'move often' is out of the window with most houses attracting stamp duty. Also, the covid effect has driven up demand significantly for sufficient bedrooms PLUS an office/workspace or garden big enough. Houses with driveways are also tipping the scales because of EVs.

DanTheMan · 9 Jul 2022 at 21:43

35 year terms (or more) are far more common nowadays, which probably explains why house prices have continued to rise.

A lot of people look at the monthly figure and anything else is irrelevant. I think this is overlooked, and goes some way to explaining why house prices have continued to rise, even whilst the cost of living has gone up massively.

People we know would rather sacrifice less in terms of space / size, and pay a mortgage for years longer. I can't blame them in some respects.

dlockers · 9 Jul 2022 at 22:09

DanTheMan said:
35 year terms (or more) are far more common nowadays, which probably explains why house prices have continued to rise.

A lot of people look at the monthly figure and anything else is irrelevant. I think this is overlooked, and goes some way to explaining why house prices have continued to rise, even whilst the cost of living has gone up massively.

People we know would rather sacrifice less in terms of space / size, and pay a mortgage for years longer. I can't blame them in some respects.

Don't forget retirement is 66 for the vast majority. This is a lot longer than it used to be and for those that can't afford to live without income prior to 66 makes longer mortgages a bit of a rounding error. They'll be working anyway...

EvilRob · 9 Jul 2022 at 22:31

caff said:
I'm coming up for renewal next month, i.e. 3 months before my fixed rate ends.

I've been looking at my account but can't get a new deal until next month without heavy ERCs.

I'm wondering whether to stick my existing lender and go for a 5-year (3.25%) or 10-year (4.04%) - but both have a heavy product fee, and at 57% LTV I'm sure I can do better than these rates. They might change over the next month thhough....

Would anyone advise using a mortgage broker for a remortgage, or just shopping around yourself?

Check a broker like London and Country.
Also, don't wait. You can apply and lock in a rate with another lender usually up to 6 months in advance. As long as you have your mortgage offer, you are good. I did this in December and then waited to complete until my fix expired last month (now locked in for 5 yrs at 1.27%).