To be more worried about mortgage rates than energy bills?

[IconicKitty]

No one is denying the energy crisis is going to bite most of us, but the mortgage interest rises are seriously worrying. And I think this is passing people by because they're on a fixed deal at the moment, which they locked in when interest rates are low.

My fixed mortgage ends next year, and current interest rates mean I'll be paying about £500 more a month. If this doesn't change before my deal ends, this will be much more dire than the energy crisis for those with mortgages.

It will affect renters too as landlords will put rent up once their mortgage increases.

I agree. Really worrying about mine but trying not to think about it too much as there's nothing I can do other than throw any spare money at overpayment but the difference will be negligible.

YANBU

YANU it’s a very large rise over such a short period of time, considering the average house price that mortgages will be based off.

People love to bring up double digit interest mortgages but it’s a hell of a lot cheaper to pay 12% interest on a 30k mortgage than it is to pay 6 or 7% on 300k, plus interest was tax deductible back then!

It will be because it’s not affecting everyone at the same time. So yours might finish in June so you’re worried about June. My friends finishes in March etc so there is no collective oh shit. Some are still locked in for 3/4/5 years.

A lot of renters rent from people or companies that don’t have mortgages on the properties too or are in social housing it will be the btl landlords and had to move but didn’t want to sell landlords who will be hit and have to hike or sell. More likely sell as say your £500 increase would just outprice the house off the rental market full stop.

People are worried, it is just that many people simply have to deal with now and deal with the future when it gets here.

Perfectly reasonable. The cost of living crisis is an absolute storm coming from all sides, and it's going to hit different people at different times from different directions. So much depends on personal circumstances.

I've been worrying about this no end since the great duo were in power.
I was really hoping my mortgage would go down as the equity has increased (house reno) since I fixed two years ago. So, the best I can hope for is it staying broadly the same as mortgage broker has found some deals with no penalty for changing if I find a better product.

I'm staying in a role I Ioath but pays well to enable me to pay what I need to. Doing two jobs for the foreseeable. It's very concerning.

I completely agree with you and our fixed deal is ending late next year. Much bigger worry for us than energy.

But the good news is that mortgage rates are coming back down. I was reading an article saying so on Bloomberg today. The outlook is much better and improved deals should be on the horizon (obviously not as good as in the past but much, much better than in September) so I'm trying not to worry too much about what will happen in the next 6 months.

Mine is up in March and honestly I’m just burying my head in the sand. Or at least trying to, but my banking app helpfully has a countdown to the day my fixed rate ends.

I can kind of plan ahead with energy, track my usage and try to keep to some sort of monthly budget (I’ve cancelled DD so only pay what I use). No amount of being careful is going to affect my mortgage bill.

I think it's because the Tory voter base is more likely to be older & mortgage free.

Ours changed from 1.49 to 4.8% last month. It's not pretty. Feel fortunate we can afford it (but can no longer afford to save) but still frustrated <<understatement

Ours isn't up for renewal for three and half years so I'm not worrying yet. We plan to extend the term when the time comes to bring payment down.

I am overpaying my mortgage by the same amount I think it will go up - a) it gets us used to less money but b) it lowers the mortgage amount outstanding so we will hopefully clear it quicker and pay less interest. We are lucky to be able to do this though.

Martin Lewis is discussing this problem with the government at the moment though - he wants a plan in place for this for the spring when it will really start to bite.

Well it’s both- I could prob afford an extra £400
on my mortgage, I could prob afford an extra £300 a month on my fuel- I cannot afford £700. The issue is you can build up debt with energy companies though.

I really hope there is no government intervention. There mustn’t be, it’s a free market economy and they have interfered too much already. Propping up,house prices is unsustainable in the long run, if people encounter difficulties I sympathise but it’s probably inevitable that there will be repossessions etc, the government needs to let the market sort itself and Martin Lewis needs to stop meddling

My fix is until May 25 so I'm.praying hard it was come down a bit by then.

With regards to raising rent, I wouldnt even get to that point. I'd have to sell as its all become to risky AND staying on the property ladder ( which is why I bought it) makes no sense if its loosing me money. But head in the sand right now. Planning on talking to a tax expert about capital gains tax to make sure I understand all my options, but yes selling up my btl seems like the only sensible option. I'm in rented for work and it's worked so well for so long now. But times are changing unfortunately. I feel so worried for my tennants but I'm not going see my kids suffer. Its all a bit 360 shit isn't it?

I don't see it as an either/or - that's the problem. It's both; and more if you add on general price rises for groceries and so forth.

Why will it start to bite in the spring?

For those of you saying you have fixed rates up in March you can act now to secure a new deal. Mine is up at the end of March and I secured a new deal at 3.53% fixed for 5 years 6 months before.

YANBU, glad we rent. Really have sympathies for those whose rates aren’t fixed and that will go up next year. We wanted to buy next year but there is no point as our (cheap) rent is frozen for at least the next 18 months.

I think I’m more worried about energy bills for the moment my cheap fix has another couple of years to run. Oil has doubled and so has electricity bill. I can just about afford it but stuff like takeaway or nice days out is a distant memory. Like other Pp it’s going to be a culmination of things increase in groceries, energy prices plus mortgage.

I don’t find people necessarily know what interest rate changes will mean for them if they are currently on a cheap fix. Ostrich effect? If interest rates on mortgages stay around 5% my mortgage will increase by £275 a month which would be doable if food, oil, petrol and electricity prices have come back down.

100% agree
You can use less energy, you can't use less house

I completely agree. We paid a hefty ERPC and remortgaged just before it all really went south on 2.94%- it was gut wrenching paying a lump sump and then signing up to 5 years of paying £300 more a month than we had been (far more impact on us than the fuel bills for now). I’m so glad we did do it when we did as if we were due for remortgaging now we literally couldn’t afford the rates. It’s a really scary time to be young and mortgaged up to the hilt as so many of us are.

Surely you anticipated that mortgage rates were historically low when you worked it how much you could afford to borrow?

energy price rises less easy to predict but there’s little excuse with not giving wriggle room with how much you chose to borrow.

I think as previous posters have said, it’s that so many bills are increasing in a short space of time - it’s more than just mortgage rates but theyre a big chunk when you’ve had to stretch money further and further.