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Original poster

What do you think will happen to mortgage interest rates? Wth the

179 replies

PeepsAndSheeps · 28/04/2022 09:14

What do you think will happen to mortgage interest rates? This is my first time having a mortgage during any type of a financial crisis. They've been going up recently, I assume that's set to continue?
Is there a point at which they can't go any higher? I know there were interest rates of 14/15% in my folks day.

OP posts:
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tomatoandherbs · 30/04/2022 14:51

of course I don’t think you’re lying! I don’t know who the heck you ate

i am, however, a nationwide customer who has a mortgage with them and I was intrigued as to rate comparisons LTV

tomatoandherbs · 30/04/2022 14:53

I will bow out
it seems that expressing concern for the concept of a 95/5 LTV is really not on.

Tangled123 · 30/04/2022 15:00

We took out a mortgage with a 5% deposit and got the keys days before the first lockdown. We now own 20% of the house thanks to it increasing in value and a couple of tiny overpayments. We also locked in a 5 year fix at 2.3% starting from July. For us, it was perfect timing as we got to live together during lockdown and we got a great house. If we left it longer, we wouldn’t get anything as nice as our wages haven’t really changed.

GreenLunchBox · 30/04/2022 15:43

ReadyToMoveIt · 30/04/2022 11:29

We didn’t get a government guaranteed mortgage. As I said above, we got a 95% mortgage 5 years ago, which we have been overpaying with the money we saved on extortionate rent repayments.
The point being that in many cases, it is a financially sensible decision. We’re certainly in a far better position now than if we hadn’t bought 5 years ago with a 5% deposit.

Of course it makes sense. Well done!!

GreenLunchBox · 30/04/2022 15:48

Chaoslatte · 30/04/2022 14:32

This picture shows a 95% deposit which is why it’s not coming up with anything - there’s a minimum amount you need to borrow.

Show quote history

Hahahaha, that's hilarious. This poster doesnt sound like she knows much about mortgages 🤣

ivykaty44 · 30/04/2022 15:53

@GreenLunchBox can you explain what the difference is between traditional inflation and inflation that is happening now and why with untraditional inflation the BoE will not raise the interest rate ? It would be really helpful as elsewhere the message is that interest rates will be raised but he BoE and they will be over 2% by the end of the year

essaytwenty · 30/04/2022 19:01

You can hear the dogs two houses away?

I can hear dogs barking a mile away over the other side of the valley. Luckily, it’s far enough away for it not to be a problem for us, but I do feel for their near neighbours.

Unfortunately, despite the distance, things we do sets them off. Splitting logs or firing a gun has them barking for up to an hour. I don’t know how they put up with it themselves.

essaytwenty · 30/04/2022 19:02

WTF?!!

Wrong thread!

GreenLunchBox · 30/04/2022 21:22

ivykaty44 · 30/04/2022 15:53

@GreenLunchBox can you explain what the difference is between traditional inflation and inflation that is happening now and why with untraditional inflation the BoE will not raise the interest rate ? It would be really helpful as elsewhere the message is that interest rates will be raised but he BoE and they will be over 2% by the end of the year

GAH! I wrote out a long post and then lost it.

Long story short, with the type of inflation caused by people feeling rich and spending loads, eg the current housing market, raising interest rates is the correct course of action. It cools demand. But the type of inflation we're seeing now is due to supply issues due to Ukraine, Brexit, energy prices, lorry driver shortages etc etc etc. Increasing interest rates won't cure these and also people are already cutting back due to the cost of living crisis and we are probably already in recession. Increasing interest rates now would make things worse for many who are on the edge and lots of businesses will go out of business as people have already cut discretionary spending.

I tried to find an article that explains more. This one is American but hopefully makes sense a bit. www.marketwatch.com/amp/story/raising-interest-rates-would-do-nothing-to-control-inflation-11641936876

Having said all that I do think they will continue to increase interest rates because it's their go-to tool ☹️

ivykaty44 · 01/05/2022 06:56

So it’s your opinion about how interest rates should work but not what you think will happen to interest rates after all 🤷‍♀️

tomatoandherbs · 01/05/2022 08:58

ivykaty44 · 01/05/2022 06:56

So it’s your opinion about how interest rates should work but not what you think will happen to interest rates after all 🤷‍♀️

Bingo 😂

GetThatHelmetOn · 01/05/2022 09:01

Are you in a tracker mortgage deal or in a fixed rate deal that is about to end?

If not, changes in mortgage interest rates won’t affect you at all until your current fixed deal comes to an end (You are in a fixed rate deal if you pay the same every month)

Original poster
PeepsAndSheeps · 01/05/2022 09:30

I have actually recently secured a 10yr deal for under 2%. But I feel like I'm the only one of all my friends and family worrying about this. No one else seems to be talking about it. One of my friends thought 10 years was excessive and I should have gone for something shorter.

I'm also concerned that when we come out of our 10 yr deal things will be hectic, but I know that's so far away no one can really predict what will be happening.

OP posts:
ReadyToMoveIt · 01/05/2022 09:33

PeepsAndSheeps · 01/05/2022 09:30

I have actually recently secured a 10yr deal for under 2%. But I feel like I'm the only one of all my friends and family worrying about this. No one else seems to be talking about it. One of my friends thought 10 years was excessive and I should have gone for something shorter.

I'm also concerned that when we come out of our 10 yr deal things will be hectic, but I know that's so far away no one can really predict what will be happening.

I don’t tend to talk about mortgages with my friends and family either… DH and I have just got a 5 year fix at 1.48% and we’ll worry about what happens after that when it happens.
I assume other people are getting their affairs in order too.

tadil · 01/05/2022 09:48

10% is longer than I would normally go for but at under 2% it's pretty good. Even if you don't overpay it's prudent to save for the end of the term as the future is unknown. The job market is some sectors is very hot and adding inflationary pressures so it's not all external.

Chaoslatte · 01/05/2022 11:48

PeepsAndSheeps · 01/05/2022 09:30

I have actually recently secured a 10yr deal for under 2%. But I feel like I'm the only one of all my friends and family worrying about this. No one else seems to be talking about it. One of my friends thought 10 years was excessive and I should have gone for something shorter.

I'm also concerned that when we come out of our 10 yr deal things will be hectic, but I know that's so far away no one can really predict what will be happening.

The ideal length of the deal really depends on what you intend to do in your life. If you want to move during the fixed deal there are often charges associated with that and for many people they don’t know if they’ll still want to be in that house in 10 years! Our fix ends later this year and we won’t go onto another fix because we want to move next year.

etulosba · 01/05/2022 11:51

I remember when the banks gave interest on your savings.

Some still do. Chase is giving 1.5% at the moment.

ReadyToMoveIt · 01/05/2022 11:51

Chaoslatte · 01/05/2022 11:48

The ideal length of the deal really depends on what you intend to do in your life. If you want to move during the fixed deal there are often charges associated with that and for many people they don’t know if they’ll still want to be in that house in 10 years! Our fix ends later this year and we won’t go onto another fix because we want to move next year.

Show quote history

We have fixed for 5 years but the nature of your mortgage means we can port it with no penalties/fees so were happy with that.

ReadyToMoveIt · 01/05/2022 11:52

Otherwise my fear of staying in one place for too long would prevent me from ever fixing 😂

Horcruxe · 01/05/2022 13:38

Spectre8 · 30/04/2022 07:59

Overpaying has the biggest impact in the first 5yrs of your mortgage as your interest paying back is much higher and therefore you save more over the life of your mortgage.

And its usually hardest at the start too, because you've stretched yourself so much just trying to get the mortgage.

If I had loads of money to overpay I'd just try to decrease my LTV.

ReadyToMoveIt · 01/05/2022 14:25

Horcruxe · 01/05/2022 13:38

And its usually hardest at the start too, because you've stretched yourself so much just trying to get the mortgage.

If I had loads of money to overpay I'd just try to decrease my LTV.

Show quote history

We were able to overpay in the first 5 years as our mortgage was considerable less than our rent.

GreenLunchBox · 01/05/2022 15:10

ivykaty44 · 01/05/2022 06:56

So it’s your opinion about how interest rates should work but not what you think will happen to interest rates after all 🤷‍♀️

Yes and??????

GreenLunchBox · 01/05/2022 15:15

I clearly said everyone is parroting what the BoE says and that they will put interest rates up. Not sure what your problem is.

ivykaty44 · 01/05/2022 17:16

GreenLunchBox the question was what will happen, not how you think inflation should work, lead someone up the garden path and they may get confused

GreenLunchBox · 01/05/2022 18:39

ivykaty44 · 01/05/2022 17:16

GreenLunchBox the question was what will happen, not how you think inflation should work, lead someone up the garden path and they may get confused

My apologies. I didn't realise you were the thread police.