Associate
just reached out to some mortgage brokers.....they are like a dog on a bone! 
Mortgage Rate Rises
- Thread starter glenimp617
- Start date
Caporegime
What on earth were they suggesting?! If it wasn't 10 year then they should be flogged. I know that when we got our last mortgage at the end of 2018 rates were still slowly dropping but in hindsight we shouldn't have been quite so greedy and should have gone 10 years. Probably would have been ~2.1% instead of 1.92%. That being said, if things didn't implode and rates fly up, we would have been looking at just over 1% on remortgage I imagine so paying double that would have been silly. Its always a bit of a gamble and a bit of guessing. We did not win this time around as we had to renew at the end of last year...just before the slight drop in rates.
Not the end of the world and we are lucky that we could, if we wanted, liquidate some assets to pay off almost all of our remaining mortgage but a fair chunk of it is in crypto so...to the moon!
Associate
would you advise buying a house on 5y fixed rate? my bank HSBC are doing 3.9%
Associate
He recommended I only fix for 2-years, even I told him at the time that I'd rather peace of mind for the next 5 years, not that I'm saying I had a crystal ball or anything but considering at the time it was reported on multiple financial blogs that interest rates were going to fly up, Ukraine just kicking off and the country still reeling from COVID, I didn't actually need one!!!!! Even my own sister told me only fix for 2-years and not to lock myself in, the same sister who had fixed for 2-years in August 2021 and has since nearly had to sell her house once she had to remortgage in August 2023, she instead had to get onto an interest only deal just keep the roof over her head.
Needless to say, I'll be giving that Mortgage Advisor a hard pass when my renewal comes around.
Associate
It's hard to say, as nobody truly has a crystal ball, but rates are already starting to climb down, and forecasters are predicting by end of 2025 we will be seeing base rates of <3% again..... If it was me, and I was buying / remortgaging now, I think I'd settle on a 2-year, fix gambling on a lower rate come 2026, but nobody knows whats going to happen in the world between then and now, for all we know we could be dug in some trenches somewhere haha.
Last edited:
Are they? Source?
I agree with this.
Long as you can absorb the cost of a potential rise.. I'd risk it too.
Associate
Sorry typo and corrected, Capital Economics and Nationwide both expect the base rate to hit 3% (Possibly just dipping below) by end of 2025 and to continue dropping beyond that, the BoE have an inflation target of 2% which they aim to hit by end of 2026 / start of 2027, but again, as I've said, nobody knows what world event may unfold between then and now, they're like Birthdays at the moment, one crops up every year.
Last edited:
Even if they do somehow get back to a base rate of 2% that quickly and the future looks stable, that doesn't mean mortgages will be offered at that, more likely around 3-3.5%.
Anything sub 4% right now is the bank taking a big risk at sub base rate figures
Associate
I never said mortgages potentially would, hence why I've said "base rate", but for certain for the user I replied to, if he is getting a 5-year fix at 3.9% offered now, the rates in 2 - 5 years' time should, future outlook dependent, be more favorable.
Last edited:
Well, it needs to be factored in right now. People saying a 2-Year fix at 4.5 is better than a 5-year fix at 3.9 might be being somewhat optimistic over how far rates can actually fall and how base rates will translate to actual mortgage rates.
Caporegime
What on earth did he think was going to happen to a 1.45% rate. Even if it went down to 1% I doubt you would have saved money if there was any sort of product fee involved and for what I would imagine would likely only be a few hundred quid saving if you were lucky you would be risking a huge amount.
As I said, we should have fixed for 10 years but got a little greedy but even then we fixed for 5 as a sensible compromise
Where is the big risk for them in that? I don't know the intricacies around how banks fund their mortgage lending over time but are they not lending to you at rate X and as long as they are acquiring that money at a lower rate than you are paying they are probably fine. Their risk comes from giving good rates to people with low equity.
We have about 65% equity in our house currently so unless the market fall into the ocean they will always get their money back if we cannot pay our mortgage and they repo the house.
Soldato
That's not a bad rate, I've only ever managed to get a rate of 2.99 (with first time buyer discount) and currently on 4.01%.
Anyone saying that the rate will go up or down is just guessing.
If I was trying to buy a house now, I would be looking for a house that needs little to no work done on it, as house prices may go down with the higher rates but the cost of repairs and modernisation will not be affected by the rates.
I would be prepared to may more for house that sort of house than to have to lay out the repairs and modernisation.
Soldato
Trust me, banks do not take risks..... even with my standard mortgage with a LTV of 55% they look for mortgage underwritters to ensure that they don't take the hit fully.
2008 say's hello
Surely that entirely depends on the price difference between the modernised one and the one that needs doing up...
Also, you might have to borrow loads more to get a modernised one, so you will end up paying loads more in interest.
I can't really see an argument for what you have suggested, unless there was little difference in the price between the two conditions anyway.
Last edited:
Because very, very simplistically the base rate is the cost of money, if the cost of money is 5.25% and the bank are offering it to people for 4% it's for one of two reasons the banks are betting they can make the difference up over time or in other ways, or they are desperate for customers, or a bit of both
Soldato
Crap banks, like any crap company can fold at any point. The number of actual banks that was based in the uk that was effected by the "2008 mortgages" crisis was very low..2008 say's hello
but since they was the ones that was offering 110% mortages a lot of people decided to bank with them..
It's like going to a cheap fast food place and then moaning that the food is rubblish, what did they expect?
It was far worst in the United States as it was trend to offer mortages to people that couldn't afford it as they already had 5 different mortages.
Soldato
Yeah your right, It's a personal choice (If I was buying....) I hate dealing with certain types of trade people.. and I would rather not have to spend my time to do it.
Some guy wanted to charge me £600 pounds to do the dry verging down one side of the roof just because a corner piece about a foot long broke off. The price rang bells as soon as he said it will only take me an hour.
£600 pounds for an hours work.. good work if you can get it!
Luckly, someone one recommended a chap that came round and did it in 30 mins for £70 pounds.
Obviously price does play a factor, just that all the places I've lived in; I have needed to do zero work for moderning... this is also the reason why I would not consider an old build as the walls and skinting boards not being straight would drive my OCD nuts! lol
Yeh, a lot of tradesman's prices are obscene/lolworthy. I agree with you there. Personally i don't mind doing most things myself, as in my experience i often do a better job than whatever the "professional" will do anyway.
Last edited: