Are you all ok with your mortgages?

[Whyisitallsostressfulhey]

Just having a bit of a panic.
The bank keep sending emails showing us stimulated payment needed for the next three months etc and it just seems to be climbing and climbing. So far it’s just over €200 extra per month we’re paying, but the rate at which it’s climbing is scaring me.
I don’t know enough to be honest about it all, but does anyone know the predictions? Will it keep going up and up by this amount and for how long?
How are people managing?
We live abroad, so it’s probably a bit different, but started to jump up around November. What with barely getting the same amount in weekly shop these days and petrol and everything going up, feeling really anxious.

I'm a mortgage prisoner and can't remortgage I'm scared stiff of how we are going to manage. Can't remortgage elsewhere due to this shitshow provider we are with messing up the unsecured part of our mortgage

I'm fixed till Jan 25 so I'm hopeful the worst will be over.

Yeh I have no idea if I need to wait till nearer the time to get deal or not.
Obv I will be paying more, but I can't afford more than £ 100.
Do most people add any savings. To decrease the payments.. not that I'll have much at all.

I think people need to be very worried! I worked in a bank in the late 80s boom and bust, and it was horrendous. We repossessed so many properties, and houses were far more affordable then!

I know everyone keeps saying 'but it was 14% then so you are still really low.....' - but that's rubbish. If you borrowed 2.25 x joint salaries then - say £50K, over 25 years - then repayments were far more affordable when rates went up. Young couples now borrow double those multipliers, over far longer, and there is far less margin for error.

If rates hang around the 4/5% mark for the next few years, while people struggle with the cost of living increases, I dread to think of the consequences. But the government can't allow that many repossessions, people need homes - so things are going to be very strange. The only long term solution is for house prices to stabilise and maybe in 20 years things will be affordable again - but meanwhile people are striking for money that no-one can afford, because they can't afford to live. Hard and worrying times indeed......

@Aquarius1234 given that it’s free, why have you asked a mortgage broker?

www.landc.co.uk are highly rated though I haven’t used them myself.

If you can only afford £100 increase, you may be in for a nasty shock. What’s your current fixed rate, and how much do you still owe, and for many more years?

I think the most common way to decrease payments isn’t to add savings, but to extend the term.

Fixed rate mortgages work by lenders factoring in expected interest rate rises over the fixed period. This means future base rate rises are already factored into current fixed rates.

It's looking possible that rates won't rise as much as expected next year so fixed rates in the UK are beginning to drop back.

This means fixed rates could come down next year even if the base rate rises but it's less than expected.

In summary, don't panic and fix at a high point as fixed rates may drop next year.

Don't forget that real wages are a lot higher than the 80s though and so are disposable incomes.

What people think interest rates look like over the last while:
www.bankofengland.co.uk/boeapps/database/Bank-Rate.asp

What interest rates look like over the last while if you go back a bit further:
www.propertyinvestmentproject.co.uk/property-statistics/uk-interest-rate-history-graph/

Although we've had a run of very low interest rates, that's a relatively recent thing. Maybe the economists have got better at controlling things, and we won't return to the higher rates for very long, or maybe we've just been lucky for the last decade or so.

Ah okay. I'll have to look into it. I was on a low rate 5 year fixed term 35 years.
Maybe another 35 years eeek

Wages are higher but not proportionately so. I bought my first house in 1985 - a two bed victorian terraced house in town on a main road with large garden and on street parking, for £17K. I was earning £5K at the time - a basic sort of wage for an admin job for a 21 year old. I was able to borrow three times my salary and my family lent me the rest. I took lodgers and worked lots of overtime - but it was doable.

How many 21 year old office clerks can buy anything these days on their own? If their salary is £25K (we're not in London, but not up North either) they'd have no hope of a property costing £75K or thereabouts. Cheapest one bed flat here is probably £150K. Plus living costs are higher even without the recent problems - everyone now has mobile phones, broadband, netflix etc, which all contribute to outgoings. I do worry for young people today. (and older people, who may have stretched their mortgages on the assumption that rates would stay low).

Fixed till 2026. Phew!

Just to throw some numbers in, if you took out your mortgage fixed 4.5 years ago I’m guessing your rate is under 2%

£150K over 35 years at 2% is £500 a month.
After 5 years, you’d owe £135K.
That £135K over 30 years but now at 5% would be £725 a month.

You can play with your real figure here:
www.moneysavingexpert.com/mortgages/mortgage-rate-calculator/

I would definitely speak to a broker asap to understand what might happen, and what products are available to you.

We owe £36, until April this year they want a £1,000 to cash in early. They can jog on, yes I am looking at you First Direct.
🙄

We were mortgaged to the hilt at the time and went through 10% interest rates and ate a lot of pizza on a Friday night because we couldn't afford to go out, we didn't go anywhere for about two years.

I'm on a variable, split with my husband in May and I was planning to buy him out but didn't get myself sorted quickly enough and the fix rates are now too high. If they come down to 4% I can manage, 4.5% at a push. My monthly repayments are now £250 higher than when he moved out! But still lower than a fix so I just need to sit tight.

1986 £12K salary brought a three bed for £35,000 on my own.

Could buy anything these day on my wage alone.

Bloody hell, this thread has worried me for my mum. She can't get a fixed rate anywhere so is going to be hit with the variable rates.

My brother is a mortgage broker, and thankfully he secured me a five-year fixed rate at 2.76% in July which came into effect yesterday so I know we're okay for the next five years, but he cannot find anybody willing to give my mum a fixed rate (she's just finished an IVA a year ago and nobody wants to touch her). Her payments have already increased by £78 a month since October 😩

My friends jumped by £250 month

We have a huge mortgage (£350k odd). Mortgage due for renewal late December, we remortgaged early and payed an ERPC (eugh!) but managed to secure a rate of 2.94% which seems reasonable now for a 5 year fix (couldn’t shop around as circumstances have changed since we applied- I’ve dropped hours, 2 kids, hideous childcare fees!) so we weren’t eligible for other offers.
Paying £300 more a month which is hideous. Hoping circumstances are difference in 5 years when this one ends. It’s a really worrying time.

Be a bit more proactive? Don’t just listen to your husband who may be wrong, phone the mortgage provider yourself and talk through the options.

Nearly everyone I know has a fixed mortgage, for 5 years, 10, or longer, full term till the mortgage ends. Ours is for the full term of our mortgage, such a relief.

Op sounds ill informed. Have you done any research, spoken to your bank, approached any mortgage advisors, at all?

Your mortgage affordability should have been tested against long term norms (5-6% rates, not 1-3%) when you borrowed.

I think people seem worryingly confused, a lot treating the current rate rise as the exception/blip and expecting it to "end", when in reality the crazy long period of rock bottom rates was the exception and is now ending with a return to higher norms.

Thing is we were tested in an increase but they didn’t included the rising costs of everything else heating/Food/energy etc Why would they? So it was actually pretty useless! We could have afforded the rise in mortgage costs if it wasn’t for the rising cost of everything else!

Yes I can I have spent more in the last 2 years by double compared to the first year or 2 of my 5 year fixed term.