Mortgage Rate Rises

neocon said:
It's 1.05 this morning
news.sky.com

Pound sank to record low against the dollar and UK economy predicted to flatline next year - as PM and chancellor defend mini-budget

Labour demands a "credible plan" as sterling's decline continues, fuelling fears the currency could plunge to parity with the US dollar.
news.sky.com news.sky.com

Doesn't this weakening cause more inflation?
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Depends,'if you are in a country that imports most of its goods, then yea a weaker currency means everything costs more and more money must be printed so inflation goes up - to counter this your bank should raise interest rates. If you're in a country that mainly exports, then the currency doesn't have as much affect on your inflation
 
Screeeech said:
I haven't bought anywhere yet, and I have no idea what to do lol, absolutely no idea..
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Its impossible to make big financial decisions at the moment.

All I know is paying down debt is a no brainer.


Anyone buying a first house who hasn't already got a good mortgage offer needs to be very careful they don't buy into a trap.
 
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mid_gen said:
Markets are expecting base rates of 6%+ next year now.
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This would break me. That would put my mortgage at 8 percent.
About 800 more than now every month.

If that's going to break me it's going to ruin so so many people

Edited as just calculated it
 
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413x said:
This would break me. That would put my mortgage at 8 percent.
About 800 more than now every month.

If that's going to break me it's going to ruin so so many people

Edited as just calculated it
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You, me both.

That would increase my monthly mortgage payments to £3683!
 
413x said:
All I know is paying down debt is a no brainer.


Anyone buying a first house who hasn't already got a good mortgage offer needs to be very careful they don't buy into a trap.
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This is pretty much what I'm doing, I have some debt which I'm crucifying myself to pay off, regarding getting a mortgate - I'm definitley going to hold off for a while,
 
mid_gen said:
Markets are expecting base rates of 6%+ next year now.
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There was a guy on Sky news who said 5.8% earlier, which chimes with what you're saying. We were talking about it on our Monday morning standup, and people didn't seem to believe I'd heard it correctly, then some very worried talk about what people's repayments will be, as a colleague has just taken on an expensive tracker mortgage.
 
413x said:
This would break me. That would put my mortgage at 8 percent.
About 800 more than now every month.

If that's going to break me it's going to ruin so so many people

Edited as just calculated it
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Your own fault for over leveraging yourself

/sarcasm

It'd break me too.

Can't wait till they start building homeless shelters for us to all join.
 
Martini1991 said:
Your own fault for over leveraging yourself

/sarcasm

It'd break me too.

Can't wait till they start building homeless shelters for us to all join.
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Yes. My current debt is 207k on house.
I think I can pay that off at 10k a year additional to the 500-600 of repayment if I go all Out.
Which would bring down my debt to 140k ish after 5 year fix ends.
Its not enough to feel happy about it though.


But..
I think my biggest concern is jobs.
There are higher paying jobs available for me. Perhaps 10k higher.

But if the jobs market dries up, that's for me the real panic station moment.
 
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Captain Chaos said:
Im currently in a fixed deal that ends next September (last year of a 5 year fix). Early repayment charge is approx 3k and my current fixed rate is 1.84%, was trying to ride it out in the hope something stabalises next year but am getting more and more concerned with the speed of these increases. Factoring in paying an ERC, arrangment fee and a year of double the rate im currently on, just seems like a kick in the teeth. Cant make up my mind if it would it be worth jumping ship and locking in for another 5 year fixed on current rates to see me through the worst of it. Genuinely stuck!
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In a similar situation on 2 yr fix at 1.18 ending in june. If i switched now it would take a couple of years to recoup the costs of additional payments plus ERC. Current thinking was to just sit on a tracker next year and hope rates drop, which was being forecast not long ago! Earliest opportunity to change without fees is in jan so see what the state of play is then.
The press do like to scare monger with all these rate hikes. The rate predictions generally come from investors who probably have a vested interest in it going really high
 
Holy crap how can 6% be that... I'm so out of touch with London now... Or a castle for 3 million... Welcome to skidrow.
 
I'm very fortunate to have 3.5 years left on a fixed rate at 1.79%. I've been sending any spare cash I have to the mortgage as an over payment. Now interest rates are higher than my mortgage interest rate I'll start putting money into savings until the end of my fixed rate period at which point I'll make a lump sum overpayment.

Am I right in thinking that as the mortgage is of a fixed value, if I intend to use these savings as an overpayment then inflation isn't really a factor I need to be concerned about?
 
neilw said:
I'm very fortunate to have 3.5 years left on a fixed rate at 1.79%. I've been sending any spare cash I have to the mortgage as an over payment. Now interest rates are higher than my mortgage interest rate I'll start putting money into savings until the end of my fixed rate period at which point I'll make a lump sum overpayment.

Am I right in thinking that as the mortgage is of a fixed value, if I intend to use these savings as an overpayment then inflation isn't really a factor I need to be concerned about?
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Yep your right, inflation vs savings should ideally be considered against what you are specifically saving for
 
neilw said:
Now interest rates are higher than my mortgage interest rate I'll start putting money into savings until the end of my fixed rate period at which point I'll make a lump sum overpayment.
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How are you doing these calculations please? We're fortunately only just finished the first year or our 5 year fix at 1.24% (thank God!) and I've always said it's best to overpay. But obviously as rates change it's probably worth us doing this, or at least doing half and half (half overpay as we go, half save on a better interest rate). I haven't had the time to investigate yet.

One thing to be mindful of is your maximum yearly overpayment, I think ours is 10% so we can't save a vast bundle of money for the remaining four years and simply lump it in as a single overpayment.
 
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