£30,000 bribe to leave your council house

StevieJ

mower5 wrote: »

Article from the times about mortgage shock, in the summer for peeps who took out 2 year trackers in '07

Quote: For example, in June 2007 Halifax offered a two-year tracker at 0.51 points below Bank rate — currently £81 a month on a £200,000 interest-only mortgage. Halifax’s standard variable rate (SVR) is 4%, so when the deal expires repayments will rise to £666 — an extra £7,020 a year

http://www.timesonline.co.uk/tol/money/property_and_mortgages/article5682104.ece

You of course don't mention that bank rate was 5.75% when they took their mortgage out so they would have been paying 5.75 - 0.51 = 5.24%, when their deal expires they will be paying 4% Nuff Said :beer:

mower5

StevieJ wrote: »

You of course don't mention that bank rate was 5.75% when they took their mortgage out so they would have been paying 5.75 - 0.51 = 5.24%, when their deal expires they will be paying 4% Nuff Said :beer:

Just bringing article to attention. I couldn't careless whether the mortgage holders sink or swim, make big profit or drown in debt. Leveller2391 said it better than i can in #39(?), they took a gamble, we find out in the summer who will survive and who cries to the government if it goes bad.

StevieJ

mower5 wrote: »

Just bringing article to attention. I couldn't careless whether the mortgage holders sink or swim, make big profit or drown in debt. Leveller2391 said it better than i can in #39(?), they took a gamble, we find out in the summer who will survive and who cries to the government if it goes bad.

It certainly does not sound logical to me, where is the gamble in taking out a a mortgage of BR -0.51 compared to taking out the normal variable rate, it's a 'no brainer'

StevieJ

leveller2911 wrote: »

Lets be honest about this, anyone who took out a 2yr fixed rate tracker in 2007 was gambling.......ANYONE who takes on any form on mortgage that ISN'T a straight forward repayment mortgage is gambling..Some people will lose and some will gain, its no diffrent than price fixing your gas or electric supply , its a gamble.People should just "cut there cloth" and when they come up for re-newal again they may be luckier, or just do the "old fashioned repayment mortgage".

Don't understand your post, Mower obvioulsly does:D
Do you mean fixed rate mortgage as opposed to fixed rate tracker? I cannot see how a fixed tracker at -0.51 below BR can be a gamble when compared to sitting on the Variable rate (I am not sure what the relevance of repayment mortgage is in this context).

olly300

kittie wrote: »

Its topsy turvey these days. In my day the general order of doing things was
get engaged
save for a deposit
buy house max 2 1/2 times the main salary
get married
then think about having children, so that they were born into stability

Oh if only the world was so simple that you had a job for life and you didn't have any student debt to pay off. :rolleyes:

kittie wrote: »

some people won`t like this but that is the way it was, straightforward and by the way no-one was too proud to have second hand furniture and furnishings

No-one I know is too proud to have second hand furniture and furnishings.

I obviously know lots of mean people under the age of 35.

mower5

StevieJ wrote: »

It certainly does not sound logical to me, where is the gamble in taking out a a mortgage of BR -0.51 compared to taking out the normal variable rate, it's a 'no brainer'

Here's the article:

Millions of tracker borrowers face a repayment shock of up to £7,000 a year, despite interest rates falling to a record low of 1% last week.
The jump in repayments will be most severe for the many thousands of borrowers whose deals track below Bank rate, some of whom are now paying 0% following the Bank of England’s half a percentage point cut last Thursday.
They could see their monthly repayments leap by as much as eight times — from less than £100 to more than £600 on a £200,000 loan — when their deals expire.
Most of these sub-Bank rate schemes were sold in summer 2007, so the repayment shock will hit home in just a few months’ time.
About 1,500 people took out a tracker mortgage with Cheltenham & Gloucester (C&G) in July and September 2007 at 1.01% below Bank rate.





Thousands more with lenders such as Halifax and Nationwide are paying as little as 0.19% and will pay nothing if the Bank cuts rates again, as economists expect.
For example, in June 2007 Halifax offered a two-year tracker at 0.51 points below Bank rate — currently £81 a month on a £200,000 interest-only mortgage. Halifax’s standard variable rate (SVR) is 4%, so when the deal expires repayments will rise to £666 — an extra £7,020 a year.
Richard Morea of broker L&C Mortgages said: “The shock is inescapable — those on super-low rates need to be ready. Even the cheapest remortgage deals are at 3%.”
Borrowers were warned that lenders could also hike rates on new mortgages. The cost of funding fixed-rate deals rose 0.14 points last week to 2.17% — suggesting markets believe rates may have hit a floor.
Big lenders such as government-backed Lloyds, which has a 40% share of the mortgage market after taking over Halifax, withdrew all trackers last week. Halifax raised the margin on its trackers by 20 points after January’s rate cut.
We answer your questions.
Could mortgages go negative?
C&G and Halifax are among those who have imposed a 0% floor on rates, even if their deals track below Bank rate — and the Financial Services Authority, the City watchdog, is supporting them.
C&G customers who took out the 1.01% deal will pay 16p on a £200,000 mortgage as the bank’s computer systems will not allow it to pay 0%. The glitch may not be resolved until the summer, when customers will receive a refund or can opt to overpay.
Will there be more rate cuts?
Economists predict further reductions after the Bank said the outlook for the economy had deteriorated. A Reuters poll last month found most economists forecast Bank rate at 0.5% by the summer, with 40% predicting it will go to “near zero”.
So should I stay on a variable rate?
Not necessarily. While those on trackers will automatically benefit from further rate cuts, if you spend too long on a variable rate you could miss a fix at a low rate.
What are the best fixes?
HSBC is offering a two-year fix at 2.99% with a fee of £599 if you have a 40% deposit.
However, Ray Boulger of broker John Charcol said: “The worst of the recession is unlikely to last beyond 2010 and I believe rates should rise in 2011. Those coming off two-year fixes then could wish they had fixed for longer.”
Will I qualify?
Falling house prices have robbed homeowners of 16% of their equity in the past year, so you may miss out on the best deals — unless you pay off some of your capital.

Have a read and tell me where you think the journo got it wrong.

StevieJ

I have read it sensationalist claptrap, Just two points.

1) People who are coming off deals will (or should be) well aware of their position
2) The people will be paying less in the summer (all things being equal) than when they took the mortgages out.

There was time when you could read newspapers like the Times and get a balanced view.

leveller2911

StevieJ wrote: »

Don't understand your post, Mower obvioulsly does:D
Do you mean fixed rate mortgage as opposed to fixed rate tracker? I cannot see how a fixed tracker at -0.51 below BR can be a gamble when compared to sitting on the Variable rate (I am not sure what the relevance of repayment mortgage is in this context).

I was merely pointing out that when someone fixes a mortgage for a term of say 2 yrs they generally do it for 2 reasons...

1st they have the comfort of knowing what they will pay for the 2 yrs
.
2nd They have a belief that the SVR will increase..

IE. Gamble.... your putting yourself in the hands of the roulette wheel.

If Its Not a gamble then what is the point of so many mortgage products...??

Back to basics I say.Having a mortgage is a gamble full stop.

Your gambling you will stay in employment.
Your gambling on the rate rises,cuts.
Your gambling on the value increasing (majority of people see it as an investment, but its still a gamble )

Im Not Against gambling ,just don't whinge when it doesn't go the way you want it to.I don't see it bening any different to fixing your gas price Stevei J a tracker may be a bit more stable but I still see it as a gamble..... like life I guess

StevieJ

leveller2911 wrote: »

I was merely pointing out that when someone fixes a mortgage for a term of say 2 yrs they generally do it for 2 reasons...

1st they have the comfort of knowing what they will pay for the 2 yrs
.
2nd They have a belief that the SVR will increase..

IE. Gamble.... your putting yourself in the hands of the roulette wheel.

If Its Not a gamble then what is the point of so many mortgage products...??

Back to basics I say.Having a mortgage is a gamble full stop.

Your gambling you will stay in employment.
Your gambling on the rate rises,cuts.
Your gambling on the value increasing (majority of people see it as an investment, but its still a gamble )

Im Not Against gambling ,just don't whinge when it doesn't go the way you want it to.I don't see it bening any different to fixing your gas price Stevei J a tracker may be a bit more stable but I still see it as a gamble..... like life I guess

What you said
Lets be honest about this, anyone who took out a 2yr fixed rate tracker in 2007 was gambling.

A tracker (be it on a special deal or not) is not fixed and will vary with the base rate or BS standard rate.

lil'H

I'm a single parent I've studied hard, i work hard, I've saved hard to buy my own place. never had a council home because I refused to sit on benefits for the years it would take to get to the top of the list. Where's my 30k reward?