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Original poster

Mortgage repayments are terrifying

167 replies

LemonAda376 · 08/09/2023 17:59

My mortgage is up for renewal and I've had some quotes from my mortgage advisor.

My payments are going up by £400 per month.

I work part time and my husband works full time. We are barely scraping by just now and are in some debt as it is.

We can increase our term which will lower it but we will still be paying £200 more per month and adding a other 8 years onto our mortgage.

Any advice :( is this just the ways things are going just now?

OP posts:
daffodilandtulip · 09/09/2023 22:17

But did people really think it would stay at 1 or 2% forever? Would a sentence saying "it could cost you..." not make anyone stop and think before they stretch themselves?

Milkkbottles · 09/09/2023 22:20

This reply has been withdrawn

This has been withdrawn by MNHQ at the OP's request.

memote · 09/09/2023 22:20

@Oakbeam what prices did you think I was referring to in a post talking about prices vs salaries on a thread about mortgages going up
& "normal" interest rates?

I mean it was clear to me i was referring to house prices as opposed to egg prices 🤷🏻‍♀️

memote · 09/09/2023 22:23

But did people really think it would stay at 1 or 2% forever? Would a sentence saying "it could cost you..." not make anyone stop and think before they stretch themselves?

I think that's unfair

Oakbeam · 09/09/2023 22:28

*what prices did you think I was referring to in a post talking about prices vs salaries on a thread about mortgages going up
& "normal" interest rates? *

The prices that were driving the increase in mortgage rates. Obviously.

Oakbeam · 09/09/2023 22:37

But did people really think it would stay at 1 or 2% forever? Would a sentence saying "it could cost you..." not make anyone stop and think before they stretch themselves?

I think in some ways it is similar to the way a previous generation were duped into taking out endowment mortgages. They saw what they wanted to see. Returns had been high for years, why would they drop in the near future?

Paul2023 · 09/09/2023 22:40

The way to lower inflation is to stop
people spending money on goods and services, which in turn lowers demand and ultimately lowers prices.

So as strange as it sounds the government want people to spend less and save more. They don’t actually want people to go out and spend money.

DrySherry · 09/09/2023 23:04

At least you can rely on the value of the property increasing in the long term, it has always been so.
In the short term - people may have no choice but to pay more to the bank for their borrowing on an asset that is actually falling in value. But this is temporary. Things will balance out again once values have adjusted and we will go back to property making owners a profit again. Even if interest rates are now going to stay around long term averages. Which I suspect is what will happen.

Milkkbottles · 09/09/2023 23:14

This reply has been withdrawn

This has been withdrawn by MNHQ at the OP's request.

catsliketowearsocks · 10/09/2023 06:24

daffodilandtulip · 09/09/2023 22:17

But did people really think it would stay at 1 or 2% forever? Would a sentence saying "it could cost you..." not make anyone stop and think before they stretch themselves?

I took my mortgage out five years ago and there was a clear warning letter that said it would cost x if the interest rate went up to 10%.

MidnightOnceMore · 10/09/2023 07:18

daffodilandtulip · 09/09/2023 22:17

But did people really think it would stay at 1 or 2% forever? Would a sentence saying "it could cost you..." not make anyone stop and think before they stretch themselves?

If your choice is £1500 on rent vs £1200 on mortgage, the only rational choice is the mortgage. Not getting onto the housing ladder has long term financial implications affecting retirement.

The housing price situation is impossible for an individual to solve and there are only risky options for many.

Blaming the victims of a widespread societal problem - the massive disparity between income and housing cost - is very unfair.

MidnightOnceMore · 10/09/2023 07:21

Paul2023 · 09/09/2023 22:40

The way to lower inflation is to stop
people spending money on goods and services, which in turn lowers demand and ultimately lowers prices.

So as strange as it sounds the government want people to spend less and save more. They don’t actually want people to go out and spend money.

We all understand this inflation theory, but it doesn't apply to the inflation situation we are currently in, where we have inflation caused by escalating costs of essential goods.

We don't have surplus wages chasing prices up.

C4tastrophe · 10/09/2023 17:38

@Milkkbottles but you’re not spending money on non-essentials, so it is working.
It’s also the only tool in the shed, and Rishi is an economist, and so knows he must, and he will, stem inflation.

Milkkbottles · 10/09/2023 19:03

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This has been withdrawn by MNHQ at the OP's request.

Paul2023 · 10/09/2023 19:09

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This has been withdrawn by MNHQ at the OP's request.

Yes I agree. I don’t see how making everyone’s rent or mortgage thousands of pounds a year more helps.

Obviously the banks are the winners because they’re getting presumably billions of extra money. The Halifax is now getting an extra £250 per month from me.

Oakbeam · 10/09/2023 19:12

Obviously the banks are the winners

And those able to save. They may be tempted to save more rather than spend if interest rates are high.

Paul2023 · 10/09/2023 19:14

Mortgage rates went to sensible rates in the mid 90s , and pretty much settled until 2008. Around 5 %.

But houses were much cheaper in the 2000s. I know of houses that were sold in the early 2000s for £80k and are now £600k!

It’s a double whammy. High house prices and higher interest rates.

Even a mortgage expert said that people who were paying 15% on their mortgages had properties worth £50 or £60 k. It’s relative to now even though rates are much lower now. Because house prices are so much higher than then.

Paul2023 · 10/09/2023 19:17

Oakbeam · 10/09/2023 19:12

Obviously the banks are the winners

And those able to save. They may be tempted to save more rather than spend if interest rates are high.

Edited

Yes savers who are wealthy pensioners or people who’ve payed off their mortgages !

They aren’t affected by high interest rates. Yet millions of us working class are working day and night to pay our mortgages and feed our kids. Praying we can beat our comes and put bread on the table. So well done to those people who are mortgage free.But please think of us lot struggling!

Oakbeam · 10/09/2023 19:26

But please think of us lot struggling

I dare say they are. By saving rather than spending they are helping to bring inflation down. Interest rates will follow.

TeenLifeMum · 10/09/2023 19:31

I know of houses that were sold in the early 2000s for £80k and are now £600k!

er, really? Where? Those numbers are not ones I recognise from where I used to live in Kent or where I am now in Somerset.

in 2007 we tried buying a new home and initially 3 beds were around £140000 in the May but by the September the cheapest 3 beds homes were £165000. Those houses are now selling for £265000. Our home in 2004 was 94k and is now worth £175000. Not £600k.

I’m hoping it’ll be 2 years then rates will drop to 4% if not slightly lower and stabilise. I think the 1% days are over sadly.

Milkkbottles · 10/09/2023 19:34

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This has been withdrawn by MNHQ at the OP's request.

ruby1957 · 10/09/2023 19:40

Paul2023 · 10/09/2023 19:14

Mortgage rates went to sensible rates in the mid 90s , and pretty much settled until 2008. Around 5 %.

But houses were much cheaper in the 2000s. I know of houses that were sold in the early 2000s for £80k and are now £600k!

It’s a double whammy. High house prices and higher interest rates.

Even a mortgage expert said that people who were paying 15% on their mortgages had properties worth £50 or £60 k. It’s relative to now even though rates are much lower now. Because house prices are so much higher than then.

But incomes were much much lower. Lots of goods were so much more expensive.
I do not know of any house costing £80k in 2000 that is now worth £600k - depends where it is as I suspect the answer is London. Most houses I know that were worth around £100k in 2000 are only now worth at most £300-400K

Oakbeam · 10/09/2023 19:44

Ah yeah, that thought will feed everyone's kids and pay the gas bills. Thanks rich pensioners, appreciate it.

Pensioners, rich or otherwise, didn’t create this situation. If you want something/one to blame, blame the pandemic and Putin.

MidnightOnceMore · 10/09/2023 19:48

C4tastrophe · 10/09/2023 17:38

@Milkkbottles but you’re not spending money on non-essentials, so it is working.
It’s also the only tool in the shed, and Rishi is an economist, and so knows he must, and he will, stem inflation.

Sunak is partly responsible for this bloody mess Angry

Its not the only tool either. If he wasn't on the side of big business he would have put in place a proper windfall tax on energy companies.

Milkkbottles · 10/09/2023 19:53

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