Mortgage Rate Rises

fez said:
Is that true these days? We would 100% have looked elsewhere when we remortgaged if I wasn't self employed and my partner off on maternity.
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Some may stick, especially when the balance is getting low.

Historically yes since changing lenders often came with additional costs, so it was a ball ache.

Once the internet took off, lenders would lend directly etc most people now consider a move I am sure.
 
fez said:
Is that true these days? We would 100% have looked elsewhere when we remortgaged if I wasn't self employed and my partner off on maternity.
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Seems to be dependent on what the market is doing and peopels circumstances. Early last year when mortgages were rising fast, there was a lot to be gained from comparing and switching, when the market is flat then there's less incentive to make the effort. This is an article from 2023

Why more mortgage borrowers are sticking with the same lender​

  • 50% of mortgage borrowers sticking with the same lender when their deal ends
  • This is up from roughly 25% in the early part of 2022, when rates were lower
  • Staying put can help borrowers avoid going through new affordability checks
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But here's an article from 2020

How many do not remortgage?​


We look at borrowers’ behaviour at the time their introductory rate expires to see what they do. Consistent with the MMS, a large proportion of the borrowers are attentive when their introductory rate ends. In our sample of ‘new borrowers’, 66% of people remortgage – either seeking a new deal with their existing lender (47%) or a deal with a new lender (19%). Most of these do so well in advance of their mortgage deal expiring, anticipating the change in mortgage rate and acting to forestall it.


About 14% re-pay their mortgages, most likely by selling their house. This leaves 20% who do not remortgage at the expiry of the introductory rate, and so end up on their lender’s reversion rate.
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Freakbro said:
Seems to be dependent on what the market is doing and peopels circumstances. Early last year when mortgages were rising fast, there was a lot to be gained from comparing and switching, when the market is flat then there's less incentive to make the effort. This is an article from 2023
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No new affordability checks and folks have changed their circumstances quite substantially, so lots of other non-tangible reasons to stay put too.
 
Yeah, I probably should have addressed the point I had issue with more directly. I don't think its true any more. It probably used to be but I would be amazed if the vast majority of people who have taken a mortgage in the last 10 or so years haven't at least checked other providers when their renewal comes up. You have to get a new mortgage ever X years anyway so there is little downside to compare and there are so many tools that make it easy. You don't get free product fees with your existing provider either unless that just the deal on that particular one.
 
I'm one of the ones who had their initial fixed deal and then sat on SVR with the same lender ever since. That's mainly because the fix ended around the time of the financial crash, so my SVR terms were very favourable and stayed that way for the next 15 years, and on the small mortgage I had anyway the savings were negligible to move to another fix and wiped out by any fees.
 
BongoHunter said:
Mortgage books are huge as well, there is room in them for risk + they are a (very) long game.

A lot of people stick with their provider over the lifetime of their mortgage rather than finding a new deal with a different lender at each renewal as well.
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We stuck with our last lender for years when the rates were low as the hassle of changing to save 0.1% on a 1.x% plus likely fees etc just wasn't worth it, before that we were much keener to shop around come renewal time as there were significant savings to be had as the variation in rates seemed much more significant. Going forward when the renewal comes up I will compare the offer from our current lender with a quick market check and if swapping is only going to save me a couple of hundred quid over the fixed period then I won't change as it isn't worth filling out the paper work for a new application along with bank statements payslips etc etc. I'm generally a big fan of switching things our broadband swaps every time the contract is up and before the price went bonkers I did the same with energy.
 
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gazref said:
Rates have improved dramatically recently. Seeing lenders offering at low 4% rates and with a chunky deposit you can even get a high 3% .
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It's getting tempting to look at moving. This place would do us, but I'd really like somewhere higher quality and with a bit more potential. Difficult though - we have enough put away now to go mortgage free if we don't move and that's super attractive.
 
Chihuahua7126 said:
HSBC and First Direct have will reducing rates again this week.

I only just fixed for another 5 years last week :(
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We fixed with them for 5 years at 4.64% on 2nd January, rates had hardly changed in 6 months - then the rate dropped to 3.94% the same week. If they drop again I'll be even more gutted. I'm stuck with a 3% penalty in the first year so cant really do anything. If they stay low after year 1 then it might be worth bailing.
 
I said in November a 2 year tracker is what I would have done then.
Seems like even now that would be a good shout? We might get close to 3% before financial year end at this rate! :O
 
jaybee said:
I said in November a 2 year tracker is what I would have done then.
Seems like even now that would be a good shout? We might get close to 3% before financial year end at this rate! :O
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Again, these 5 years already seem to have big drops already priced in, whereas 2 year fixes don't. The base rate hasn't moved yet, and when it does, mortgages might not track with it as expected.
 
jaybee said:
I said in November a 2 year tracker is what I would have done then.
Seems like even now that would be a good shout? We might get close to 3% before financial year end at this rate! :O
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Same

I'd only not do it if literally couldn't afford 6pc. No way rates could go near that as it would decimate everything so wouldn't need to be that high long anyway.

3pc though.
That's a lot it a bad rate even for 5 years. Because with the instability in ME things could turn back to 4-5 soon
 
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